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UK's main stock index snaps winning streak, midcaps weighed down by Saga

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By Reuters
UK's main stock index snaps winning streak, midcaps weighed down by Saga
FILE PHOTO: The London Stock Exchange Group offices are seen in the City of London, Britain, December 29, 2017. REUTERS/Toby Melville/File Photo   -   Copyright  Toby Melville(Reuters)

(Reuters) – Britain’s FTSE 100 retreated after a five-day rally on Thursday, as financial heavyweights slid on ex-dividend trading and oil majors weakened, while a profit alert sank tourism and insurance group Saga on the midcap index.

The FTSE 100 fell 0.5 percent by 0715 GMT and the FTSE 250 was down 0.4 percent.

On the Brexit front, a law was narrowly passed in the lower house of parliament to seek a second delay to Britain’s divorce from the European Union, igniting optimism that a disorderly no-deal exit could be prevented.

Sterling inched up following the vote, along with housebuilders, considered among the most exposed sectors to a hit to the economy.

But that was not enough to offset steep losses in financials Lloyds, Direct Line and St James’s Place, which traded ex-dividend.

BP and Shell slipped after crude prices weakened after a surprise buildup in U.S. inventories last week. [O/R]

Saga, the over-50s tourism and insurance specialist, contributed nearly a third of the losses in the FTSE 250 by 0728 GMT after it warned on profit and slashed its dividend amid a highly competitive motor and home insurance market.

“(This is a) kitchen sink job, it looks nasty,” one trader said.

Saga was down 38 percent at its lowest ever, leaving it on course for its biggest daily loss on record.

A bright spot was home repairs provider HomeServe, which added 4 percent on a company update saying its performance was “significantly ahead” of last year as its U.S. customer base continued to grow.

(Reporting by Yadarisa Shabong and Muvija M in Bengaluru; Editing by David Holmes)