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Oil price dips under $40 barrel; ECONOMY.

Byline: HOLLY WILLIAMS business@ncjmedia.co.uk

STOCK markets worldwide dived into the red amid a commodity price rout that saw the cost of oil touch below 40 US dollars a barrel for the first time since February 2009.

The FTSE 100 Index closed 1.4% lower, shedding 88.3 points to 6135.2, while the picture was similarly gloomy across Europe, with Germany's Dax off 2%.

On Wall Street, the Dow Jones Industrial Average opened deep in negative territory, falling more than 140 points in early trading.

Miners led the declines in London as metal prices plunged lower after more disappointing Chinese economic data, while Anglo American compounded sector losses after it suspended its dividend and unveiled a major overhaul.

Oil prices remained in the spotlight as benchmark crude fell back below the 40 US dollar a barrel mark, although it later rallied, offering some support to blue chip giants BP and Royal Dutch Shell after a punishing session yesterday.

Official figures showing output in the UK manufacturing sector contracted at a faster pace than expected in October added to the negative market sentiment and weighed on the pound.

Sterling fell to 1.50 US dollars and 1.38 euros.

Among stocks, Anglo American was the hardest hit, seeing its shares sink to a new record low, down another 12%, as it said it would more than halve its assets and make more mammoth job cuts - slashing its workforce to around 50,000 from 135,000.

Its shares were 45.4p lower at 323.7p, having already been decimated over the past year. Rio Tinto and Antofagasta followed not far behind with falls of 173p to 1893p and 36.2p to 441.7p respectively.

BP, which dropped 3% on Monday on sharply lower oil prices, clawed back from early session losses to finish 0.2p higher at 347.8p.

Sainsbury's was the only other blue chip riser, up 3p at 244.7p, although the sector had spent most of the earlier session in positive territory as market analysts said recent sales data showing a poor Black Friday performance would mean the big players were able to protect their profit margins.

Elsewhere, Entertainment One lost more than a fifth of its stock market value, following yesterday's 15% dive, as another broker slashed its rating on the owner of popular children's television character Peppa Pig.

The film and TV group was 35.5p down at 140.9p, with broker Peel Hunt raising concerns over the refi-nancing announced last week and reduced film revenue expectations.

Model railway maker Hornby was another stock suffering falls, down 2p to 93p, after it said half-year losses widened to PS4.5 million from PS500,000 a year earlier.

But it offered hope that trading was now turning the corner as it con-firmed a 10% rise in UK sales since the beginning of September.

The only FTSE 100 risers were Sainsbury's up 3p at 244.7p and BP ahead 0.2p at 347.8p.

The biggest FTSE 100 fallers were Anglo American 45.4p lower at 323.7p, Rio Tinto off 173p to 1893p, Mondi down 113p at 1376p and Antofagasta 36.2p weaker at 441.7p.

CAPTION(S):

Chinese investors nap while monitoring stock prices at a brokerage house in Beijing amid further disappointing Chinese economic data <B

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Title Annotation:Business
Publication:The Journal (Newcastle, England)
Date:Dec 9, 2015
Words:552
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