Royal Bank of Scotland has slipped back on talk of a £4bn cash call, as a slide in financials and a mixed performance from commodity companies combine to push leading shares lower.
RBS is down 1.15p at 55.15p after reports it is sounding out investors about a rights issue as it discusses its entry into the government's asset protection scheme. JP Morgan analysts have also issued a note on the bank which is hardly a ringing endorsement:
"We increase our December 2009 sum of the parts-based price target to 38p (from 26p), but with a fully diluted market capitalisation back to December 2006 pre-crisis and pre-ABN levels, we remain underweight."
Meanwhile Lloyds Banking Group, which seems to want to negotiate its way out of the asset protection scheme, has lost 1.62p to 109.05p.
Overall the FTSE 100 is 33.08 points lower at 5139.81, as investors lock in some of their recent profits and commodity prices slip. Oil and metals are lower ahead of the G20 gathering later this week and the US Federal Reserve's latest meeting and interest rate decision on Wednesday.
Tullow Oil, pushed up in recent days by good drilling news and speculative talk of a bid from Italy's ENI, is the biggest FTSE faller at the moment, down 35p at £11.44.
Rio Tinto is down 66.5p at 2671.5p while Kazakhmys has lost 25p to £10.99 despite a positive note on the miner from Goldman Sachs. The bank also likes the look of Antofagasta, upgrading it from neutral to buy and helping it climb 8p to 774p.
But Citigroup has downgraded Kazakhmys from buy to hold, and raised its rating on Eurasian Natural Resources Corporation, up 3.5p to 895.5p, from hold to buy.
Lower down the market pubs group Punch Taverns is off 2p to 122.2p even though it continues to repurchase convertible bonds for cancellation. Mark Brumby at Astaire said:
"Punch has announced that it has repurchased 33.9% of its 5% Convertible Bonds via a series of market transactions. The bonds will be cancelled. Thereafter there will be £102m nominal of the bonds outstanding meaning that the group has recently cancelled around 63% of the bonds previously in issue."
