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By Sudip Kar-Gupta
LONDON (Reuters) - Britain's top equity index dipped on Monday to break off from a four-day winning streak, pegged back by a drop in major utility stocks.
The blue-chip FTSE 100 index (FTSE), which rallied last week to extend a rebound off 15-month lows reached in October, was down by 0.4 percent at 6,521.70 points by the middle of the trading session.
Utility stocks dominated the list of the FTSE's worst-performing shares.
SSE (L:SSE) fell 1.8 percent. British Gas owner Centrica (L:CNA) and United Utilities (L:UU) both weakened 1.4 percent, while Severn Trent (L:SVT) fell 0.9 percent.
Traders said the sector had been hit by a negative note from Investec, which started its coverage of United Utilities and Severn Trent with a "sell" rating.
They added that utilities had fallen out of favour as a result of last week's stock market rebound, which led investors to prefer sectors that tend to outperform in a rising market, such as banks, over more defensive plays such as utility stocks.
"I'm still a fan of the utility stocks, due to their chunky dividend yields, but I wouldn't buy them at current levels," said Berkeley Futures associate director Richard Griffiths.
HSBC DIPS
A fall in the shares of global banking group HSBC (L:HSBA) also weighed on the FTSE.
The shares declined 1.7 percent to 628.70 pence after HSBC missed expectations with a 12 percent drop in underlying third-quarter earnings and set aside $378 million to cover a potential settlement with the UK regulator for alleged manipulation of currency markets.
"The results are OK, but I wouldn't want to buy them at these levels. I'd rather buy HSBC shares around the 600 pence level. There are still too many ongoing regulatory issues with them," said Beaufort Securities sales trader Basil Petrides.
The FTSE hit a peak of 6,904.86 points at the start of September, its highest since early 2000, but then slumped to 15-month lows in October as weak European economic data knocked back stock markets.
The index then rebounded last week but it remains down by around 3 percent since the start of 2014.
(additional reporting by Alistair Smout; editing by Keiron Henderson)