FTSE falls into the red on bank downgrades

Concerns raised by ratings agencies, analysts and hedge funds have pushed bank shares lower this morning as the FTSE 100 snaps seven straight days of gains.

Continued worries over the stability of the Co-operative Bank, whose debt was downgraded six notches by Moody's last Friday, hit sentiment across the sector, with Lloyds Banking Group and RBS each falling 2%. Elsewhere, Investec downgraded HSBC from 'buy' to 'sell' following the bank's results last week, saying there is now "limited further upside for the stock", sending shares down 2% to 730p. "Underneath all the optical complexity, the key issues for HSBC do appear perfectly simple. It is generating far more capital than it is able to deploy, and as such, muted (or non-existent) loa...