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Britain's FTSE hovers near one-week lows as StanChart slides

Tue, 27th Sep 2016 16:15

* FTSE 100 down 0.2 pct at close

* StanChart falls after report of U.S. probe

* Wolseley slips on cautious outlook (Recasts, adds detail, updates prices at close)

By Kit Rees and Sudip Kar-Gupta

LONDON, Sept 27 (Reuters) - Britain's top shares indexhovered near one-week lows on Tuesday, weighed down by a drop inbanking stocks such as Standard Chartered and weakerenergy company stock prices.

The blue-chip FTSE 100 index was down 0.2 percent at6,807.67 points at its close, near its lowest level in around aweek.

The FTSE gave up gains made earlier in the session followinga rebound in world stock markets after Democrat Hillary Clinton,favoured by many business leaders and investors, was seen tohave won the first U.S. presidential election TV debate againstRepublican rival Donald Trump.

The FTSE remains up by around 9 percent since the start of2016 but it fell 1.3 percent on Monday in what was the FTSE'sworst one-day percentage drop since late June, when Britainvoted to quit the European Union in a shock "Brexit" vote.

Standard Charterd was the top faller, down 2.5percent following a media report that the bank faced aninvestigation by the U.S. Department of Justice into whetherStanChart failed to stop alleged misconduct at MAXpower GroupPte Ltd, an Indonesian power plant builder.

Standard Chartered said that it had referred the allegations to the appropriate authorities.

Royal Bank of Scotland and Barclays fell1.6 percent and 1.3 percent respectively.

Shares in oil major Royal Dutch Shell dropped 2.2percent, with BP also slipping 0.9 percent, hit by weakeroil prices.

The Organization of the Petroleum Exporting Countries andother oil producers, led by Russia, are meeting on the sidelinesof the International Energy Forum in Algeria from Sept. 26-28,but investors are sceptical that they can agree to limit output.

"Markets are still unconvinced that an agreement will bereached with Iran downplaying yesterday the chances of OPEC andnon-OPEC producers sealing a deal to curb output," said FXTMchief market strategist Hussein Sayed.

Wolseley fell 1.3 percent after the building materialsdistributor warned of tough market conditions as it reportedresults.

"The U.S. industrial market remains weak and the outlookstatement mixed, citing an uncertain economic environment insome markets and continued price deflation," Jefferies analystswrote, keeping a "hold" rating on Wolseley shares.

Travel & leisure stocks were among the top risers, withcruise operator Carnival gaining 4.8 percent after atarget price upgrade from Natixis.

TUI rose 1.5 percent after a TUI executive saidAugust trading was in line with expectations and bookings fromBritain did not fall as much as expected after the vote to leavethe European Union. (Editing by Robin Pomeroy)

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