The FTSE 100 index has dropped 15.9 points or 0.29% to 5,501.5, after a gloomy performance from the oil majors, along with profit-taking from PartyGaming which caused sellers to offload stock late in the day.
Safety worries following Sunday’s blast at an oil depot in Hemel Hempstead knocked BP, Royal Dutch Shell and Cairn Energy oil companies as BP slipped 1.48% to 630.5p, while Shell dropped 0.95% to £18.68 and Cairn Energy also fell 1.21% to £18.74.
Boots also ended lower with a drop of 0.91% to 596.5p following a report suggesting Alliance Unichem shareholders are getting increasingly concerned about the planned £7bn merger. While Boots closed down, Alliance Unichem gained 1.79% to 768.5p.
Elsewhere, Next fell 1.31% to £15.10 as it was hit by a Morgan Stanley downgrade to 'underweight' from 'equal-weight' and price target cut to £13.70 from £13.90, although Marks & Spencer gained 1.36% to 485.5p, as it picked up a ratings upgrade to ‘overweight’ by the same broker.
It was not all bad news today as directories group Yell extended gains following Friday’s investor day, advancing 1.29% to 509.25p, while ITV was also in the blue with gains of 1.38% to 110p, following reports ITN - in which the group has a 40% stake - has received two approaches from a US media group and a UK company.
Meanwhile, Lloyds TSB closed down 0.26% to 481.5p, despite stating second half revenue growth throughout the group means it is on track to deliver a 2005 trading performance in line with market expectations.
In the US, the Dow Jones Industrial Average index has opened well with gains of 12.55 points or 0.12% to 10,791.13, as the energy sector has been lifted by reports ConocoPhillips is in talks to buy oil and gas producer Burlington Resources for more than $30bn.
ConocoPhillips has fallen $2.61 or 4.14% to $60.46, but Burlington Resources have jumped $5.31 or 6.98% to $81.40.
Other natural gas producers have risen with Chesapeake Energy is up 2.57% to $31.95 and Williams Companies has so far risen 3.91% to $23.63. Meanwhile, Newmont Mining has climbed 4.97% to $52.13, as the spot gold is trading at around $537 an ounce.
In other deal news, Viacom’s Paramount Pictures has agreed to buy DreamWorks SKG in a $1.6bn cash-and-debt deal. Viacom has gained 1.31% to $34.85, after it also announced a $3bn stock repurchase program as part of its planned split by December 31 into two publicly-traded companies.
Wal-Mart Stores has also advanced 1.08% to $48.60 while stocks of several drugmakers were also up amid news of successful trials. MedImmune has risen 4.22% to $35.60 after the company said an improved version of its nasal-spray flu vaccine significantly reduced the number of flu cases in an important clinical trial.
Elsewhere, Myogen has shot up 39.28% to $26.84, after the drugmaker said its experimental treatment for pulmonary arterial hypertension has proved effective in their latest study.IFAonline
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