UK banks’ shares fall on FTSE 100 after Russia is hit with sanctions over Ukraine
Britain’s banks were among the biggest fallers on the London Stock Exchange on Monday after western governments agreed over the weekend to expand financial sanctions against Russia.
HSBC, NatWest, Barclays and Lloyds lost more than 3% of their value and were joined by the insurers Prudential and Legal & General as investors shifted their funds to defence manufacturers and firms likely to benefit from price rises after Russia’s invasion of Ukraine. The FTSE 100 was down 1.3%.
The value of BAE Systems, which makes weapons for the UK and US military, soared 14% to 745p, while the tech defence company Chemring was the biggest faller on the FTSE 250, down 11% at 304p.
On a morning of frantic trading, companies with strong connections to Russia were also among the biggest fallers in London.
Evraz, the Russian steel and coal businesspart-owned by the Chelsea FC owner Roman Abramovich, slumped by 25%. Abramovich owns 29% of the company and received a £1.2bn dividend last year after the company reported a £3.1bn profit in 2021.
Polymetal, the second largest gold producer in Russia, plunged 55% as investors fled for safer havens.
BP, which is the biggest foreign investor in Russia, said on Sunday it was abandoning its stake in the state oil company Rosneft at a cost of up to $25bn (£19bn). The British oil company lost 7% of its value on Monday morning, though analysts said it might have been more if its chief executive, Bernard Looney, had rejected overtures from the business minister, Kwasi Kwarteng, to cut ties with Rosneft.
Stocks on continental European exchanges also dived as investors digested the impact of western countries limiting Russian banks and institutions access to the Swift international payments system.
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