The FTSE 100 is slightly down at the start of trading with a loss of 5.9 points, or 0.11%, to 5,515.2 as mining and oil stocks have fallen.
Xstrata is currently topping the losers with a drop of 19p, or 1.4%, to 1,338p, while Royal Dutch Shell is down 20p, or 1.11%, to 1,774p. BG Group is also struggling with a fall of 6p, or 1.09%, to 546p.
It is not all bad news though, as bank stocks such as Barclays and HBOS have gained. Barclays has added 3p, or 0.5%, to 603.5p, while HBOS has advanced 7.5p, or 0.8%, to 944p.
Elsewhere, The London Stock Exchange has fallen 6p, or 0.96%, to 616p, as Macquarie Bank launched a £1.5bn bid for the exchange, confirming a proposal which Europe's biggest stock market rejected last week as "derisory".
Just hours before a 5pm deadline set by the UK's takeover watchdog, Australia's Macquarie Bank said it was offering 580p a share in cash for the LSE.
Meanwhile, British Land is doing its best to lead a rally with gains of 30p, or 2.99%, to 1,033p, rising for the third straight day on hopes that Abu Dhabi's royal family might buy one of the company's portfolios. Land Securities has also risen 45p, or 2.8%, to 1,655p.
Among the current losers, WPP has fallen 7p, or 1.12%, to 617p, after Credit Suisse First Boston cut its rating on the advertising company to 'neutral' from 'outperform' and cut its price target to 660p from 690p.
In Japan the Nikkei 225 Stock Average lost 210.14, or 1.4%, to 15,254.44 at its close a short time ago, as stocks had their biggest two- day drop in 10 weeks, after the dollar fell the most against the yen since July, with exporters such as Toyota Motor and Canon leading the declines.
Exporters led declines on concern that the value of their overseas earnings may decrease, as the dollar slid 2.2% to 117.39 against the yen, the biggest slump since July, when it fell 2.3%.
Toyota, the world's most valuable carmaker, slid 130 yen, or 2.2%, to 5,670, while Canon, the world's largest copier maker, lost 130 yen, or 1.9%, to 6,870.
Sony, the world's second-largest consumer electronics maker, dropped 60 yen, or 1.4%, to 4,330, while Honda Motor, which is the most dependent on US sales among Japan's top three carmakers, slipped 170 yen, or 2.5, to 6,590.
Elsewhere, Japan Airlines, the nation's largest carrier, climbed 6 yen, or 2%, to 312, while All Nippon Airways, the second- biggest, rose 3 yen, or 0.7%, to 429.
By contrast, energy-related stocks dropped along with oil prices. Inpex, Japan's biggest oil explorer, fell 50,000 yen, or 4.6%, to 1.03 million, while Nippon Oil, the nation's biggest petroleum refiner, declined 36 yen, or 3.8%, to 924p.
Meanwhile, Advantest, the world's biggest maker of equipment used to test computer memory chips, sank 320 yen, or 2.9%, to 10,620, while Tokyo Electron, slipped 60 yen, or 0.8%, to 7,080.
Among the best performers, Nisshinbo Industries, a textiles maker, jumped 85 yen, or 6.8%, to 1,331 after saying it developed a fabric with a university in northern Japan that is 99% effective in destroying the bird flu virus.
In the US the Dow Jones Average closed up 59.79 points, or 0.55%, to end at 10,883.51, on a growing perception that the Federal Reserve was nearing the end of its credit tightening cycle.
Honeywell, the world's largest manufacturer of cockpit electronics, advanced 4.5% to $37.50, after it said it expects earnings to rise by up to 30% in 2006 on strong aircraft demand.
Honeywell was the latest conglomerate to give an upbeat outlook after General Electric rose 0.9% to $35.77, after it reaffirmed its outlook for stronger profit in 2006.
Shares of Procter & Gamble also rose 1.9% to end at $59.62, after hitting a lifetime high of $59.70 during the session, and brokerage Banc of America Securities raised its prices target on the company.
Elsewhere, Boeing shares gained 1.2% to $71.45, after the jet maker announced a $10bn order from Qantas Airways for 65 Boeing 787 Dreamliner jets, with an option for an additional 50 planes.IFAonline
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