UK stocks : FTSE 100 drops 1.1 pct
Britain's blue chip shares fell sharply on Thursday as traders took profits on an index that has outperformed Europe this year, with banks leading losses after comments by key policymakers.
The FTSE 100 closed down 66.92 points, or 1.1 percent, at 6,228.42, lagging major European peers.
The index has been the stand-out performer in Europe since the start of 2013, having seen its best January since 1989, and was ripe for profit taking, traders said.
"We haven't managed to break through 6,300 and hold it. I think it's just down to profit taking," said Darren Easton, director of trading at Logic Investments.
"I think 6,300 is becoming a bit of a sticking point."
Since posting its biggest one-day fall in three months on Monday, the index has failed to close above 6,300 all week.
However, the FTSE has gained 5 percent so far this year, compared to slight falls year-to-date on the German DAX and the French CAC.
Banks were among the biggest fallers on Thursday, with the sector dropping 1.6 percent after Bank of England governor-designate Mark Carney outlined a tougher line on the sector.
"He came across as much more aware of the need to be more interventionist in banking matters ... I think it's prescient, I think it's right, but banks will see the ability to grow revenues switched off," Gerard Lane, equity strategist at Shore Capital, said.
"Carney's use of anti-free market tools make it a very different ball game, and the banks in the UK are going to struggle."
Carney also reaffirmed his faith
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