By Atul Prakash
LONDON (Reuters) - Britain's top share index fell on Monday and made its worst one-day performance in three months, with Lloyds (L:LLOY) pushing banks lower after a downgrade by Goldman Sachs (NYSE:GS) and miners tracking weaker metals prices.
InterContinental Hotels (L:IHG) fell 5.7 percent, the worst performer in the blue-chip FTSE 100 index (FTSE), after Morgan Stanley (NYSE:MS) downgraded the stock to "underweight" from "equalweight" saying U.S. revenue growth was expected to continue to weaken.
A downgrade by another broker bank hit Lloyds (L:LLOY). The British bank fell 3.1 percent after Goldman Sachs cut its rating for the stock to "sell" from "neutral", saying it faced incremental competition from HSBC (L:HSBA).
The FTSE 100 index (FTSE) ended down 1.3 percent, its worst one-day percentage decline since late June when Britain voted to leave the European Union (Brexit).
Resource-related stocks also lost ground, with the UK mining index (FTNMX1770) falling 1 percent, as prices of major industrial metals tumbled. Shares in Anglo American (L:AAL), Antofagasta (L:ANTO), Rio Tinto (L:RIO) and Glencore (L:GLEN) retreated by 0.8 to 2.1 percent.
"The UK market has started the week on the back foot, with some major stocks hit by downgrades by heavyweight investment banks. Nervousness ahead of a meeting of OPEC is also hurting sentiment," Securequity senior trader Jawaid Afsar said.
OPEC members are meeting on the sidelines of the International Energy Forum in Algeria until Wednesday and will be debating a possible output-limiting deal. [O/R]
Monday's decline was widespread, with only three stocks in the FTSE 100 index staying in positive territory.
However, the UK market index has surged nearly 18 percent since a post-Brexit sell-off three months ago and is up more than 9 percent so for this year thanks to supportive central bank policies and the resilience of leading economic indicators.