FTSE 100 slips as banks weigh; defensive stocks limit decline

HSBC Holdings

Tue 11:30

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Oct 20 (Reuters) - The FTSE 100 declined on Tuesday, with banks dragging the most, as elevated oil prices continued to weigh even as gains in defensive sectors helped cushion the fall. 
The blue-chip FTSE 100 index .FTSE fell 0.8% to 10,680.25 points by 1006 GMT. The midcap FTSE 250 .FTMC lost 1% and was on track for its biggest one-day fall in nearly two weeks.
Banks .FTNMX301010 fell nearly 2% to an over four-month low. Heavyweight lenders HSBC HSBA.L, Lloyds LLOY.L and NatWest NWG.L fell between 1.6% and 2.3% 
Industrial stocks .FTNMX502030 lost 1.8%, with Diploma DPLM.L and Rolls-Royce RR.L down 3.3% and 1.7% respectively
Bunzl BNZL.L slipped 2.2% despite reporting a 3.7% rise in third-quarter revenue and maintaining annual forecasts
Oil prices advanced with Brent reaching a five-month high of $111.05 a barrel O/R
Investors flocked to sectors considered traditionally defensive, with healthcare .FTNMX201030 up 0.5%. The personal care, drug and grocery sector .FTNMX452010 added 0.3%
Data showed a modest rise in the pace of pay growth for British workers and hints of a small recovery in the jobs market, which could bolster the case for a Bank of England interest rate hike next month, pressuring rate-sensitive midcaps
The Times reported that Finance Minister John Healey rejected calls to raise capital gains tax ahead of his October 28 budget, amid concerns that higher taxes could prompt wealthy individuals to leave Britain or delay asset sales
Miner Anglo American AAL.L dipped 1.6% after maintaining its 2026 copper production guidance despite a 5% drop in third-quarter copper output
Technology and online grocery firm Ocado OCDO.L rose 6.6% to top the FTSE 250 after J.P. Morgan raised its price target on the stock to 460 pence from 290 pence
Investors will watch for UK inflation and retail sales figures this week, while markets enter another corporate earnings season

(Reporting by Darshan Kumar in Bengaluru; Editing by Harikrishnan Nair)
((darshan.kumar@thomsonreuters.com))