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Tuesday 02nd of December 2008
June 8, 2006

Miners, oil send London markets into decline


by Elaine Frei

Only six stocks on the FTSE 100 in London managed to end the session on a positive note on Thursday as the 100 dropped 2.5 percent to close at 5,562.9. This took the blue-chip index to 9.4 percent below the 5 ½ year high it reached in April. The FTSE 250 did even worse on the day, closing down 2.5 percent to 8,813.7, it’s lowest close since December. Miners and oil were major factors in the declines.

In the mining sector, share values fell as metals prices declined. BHP Billiton decline by 6.5 percent to 935½p, while Anglo American lost 6.8 percent to £18.45 and Rio Tinto dropped 7 percent to £25.80.

Crude oil prices dropped on the news that al-Queda leader Abu Musab al-Zarqawi had been killed in an air raid in Iraq. The price declines came on the theory that the terrorist’s death would lead to a decline in disruptions to oil production there. Lower oil prices led to declines share value for oil companies. BG Group dropped 2 percent to 676p, while BP lost 3.4 percent to 603p.

Among gainers on the day were Centrica, the owner of British Gas, which added 1.4 percent to 279p. The gain came as rumors spread that Gazprom is looking to take a 10 percent stake in British Gas. Some analysts, however, pointed out that a similar rumor in February did not lead to an actual purchase by Gazprom.

William Morrison also was up, by 0.2 percent to 195½p, also on bid rumors. Talk had it that Icelandic investment group Baugur and Allan Leighton were thinking about taking over the supermarket operator.

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