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Stock Watch; Stocks and shares.

THE FTSE 100 Index fell almost 3% after investors were spooked by a spike in oil prices and fears over inflation in the UK and US.

Comments from cartel Opec that oil could reach EUR170 a barrel this summer combined with fresh concerns over inflation from the Bank of England and the US Federal Reserve in a miserable session for blue-chips.

The London market eventually closed 147.9 points down at 5518.2 - the lowest since March - wiping pounds 35bn from blue-chip stocks.

A poor opening for US markets increased the pressure on London's blue-chip stocks late in the session after corporate giants General Motors and Citigroup were hit with downgrades.

Oil and commodity stocks gained from the higher prices but banks, retailers and travel groups were heavy casualties.

News of a rights issue from Belgian bank Fortis hit sentiment as Barclays lost all the ground it made on Wednesday, after confirming plans to raise pounds 4.5bn of new capital from overseas.

Shares fell 27.75p to 303.75p.

Halifax Bank of Scotland, whose shareholders overwhelmingly backed its pounds 4bn rights issue, slipped 16p to 276p - just a single penny above the "discounted" rights price.
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Title Annotation:Business
Publication:The Journal (Newcastle, England)
Date:Jun 27, 2008
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