Footsie records biggest weekly loss in almost three years as slide continues

FTSE: 5,246.99 (-146.15) Mid-250: 10,330.16 (-240.48) Small Cap: 2,972.23 (-97.04):UK STOCKS fell for a sixth day as the FTSE 100 Index recorded its biggest weekly loss in almost three years, even after a report showed the US added more jobs than expected last month.

Oil and mining stocks retreated as BP, Royal Dutch Shell and Rio Tinto Group fell. Glencore International surged 4.6 per cent, snapping eight days of losses. The FTSE 100 dropped 146.15 points, or 2.7 per cent, to 5,246.99 at the 4:30pm close in London, bringing the decline for the week to 9.8 per cent, the most since November 2008 and its longest streak of losses since March. Better than expected US job figures failed to assuage concern over the strength of the global economic recovery.

The FTSE All-Share Index dropped 2.7 per cent. “Its fair to say we’ve seen panic in the last few days,” said David Jones, chief market strategist at IG Index in London. “It’s been catastrophic and it looks like were in for more of the same next week. People are seeing no reason to buy.”

The Labor Department’s monthly payrolls report showed US employers added 117,000 workers in July, beating the median estimate in a Bloomberg News survey. The jobless rate dropped to 9.1 per cent.

More than $4.5 trillion has been wiped off the value of equities worldwide since July 26. Oil Company BP, Europe’s second-largest oil company, fell 2.3 per cent to 410.65p after it began talks with Transocean Ltd over the 2010 Gulf of Mexico oil spill. Transocean chief executive Steven Newman reiterated that BP is liable for all costs and fines. Royal Dutch Shell slid 3.9 per cent to 1,925p, a sixth day of losses. Royal Bank of Scotland led a retreat of banking stocks. Britain’s biggest government controlled bank plunged 6.9 per cent to 28.18p after posting a wider than estimated first-half loss of £1.4 billion. The bank also said it will cut about 2,000 jobs in the next 18 months. Lloyds Banking Group slumped 6.1 per cent to 32.85p.

HSBC Holdings, Europe’s largest bank by market value, dropped 3.7 per cent to 557.1p.

Barclays, the UK’s second-largest bank by assets, slid 5.1 per cent to 186p. Logica, an Anglo-Dutch computer-services provider, plunged 14 per cent to 88.55p after posting first-half pretax profit of £75 million, down from £86 million a year earlier. Commodity trader Glencore closed up 4.5 per cent to 408.4p. – (Bloomberg)