FTSE falls sharply into red

The London market fell sharply into the red today after sky-high oil prices and a tumble on Wall Street last week knocked confidence.

Only two stocks were in positive territory as investors seized the chance to bank profits, pushing the FTSE 100 Index down 58.1 points to 4557.3.

The fall came on the back of Friday’s performance from the Dow Jones Industrial Average, which fell more than 100 points to its lowest point this year.

Concerns were also heightened by the price of a barrel of sweet, light crude for December delivery hitting 55.60 US dollars overnight.

The renewed spurt in oil prices followed a possible shipping strike in Norway, which sparked new fears that supplies could be disrupted.

Ailing retailer Sainsbury’s was the highest Footsie riser, up 2% or 4.5p to 251p on the back of speculation that City financier George Magan was in the preliminary stages of a £5bn (€7.2bn) takeover bid.

Cigarettes group Gallaher tracked it higher, up 3p at 668p, as worried investors switched into defensive stocks.

Marks & Spencer slipped below its opening mark after setting the strike price of its tender offer, which will see more than a quarter of its stock repurchased and cancelled. Shares fell 0.5p to 356.5p.

But stocks from a range of sectors were mired in negative territory, led by mining group Xstrata, off 25p at 863p, and insurer Legal & General, down 2.5p at 98p.

Elsewhere, Manchester United fell 8.75p to 275p after calling off takeover talks with American sports tycoon Malcolm Glazer.

But there was better news for investors in Warner Chilcott after the drugs group confirmed a higher takeover proposal that would value the company at more than £1.5bn (€2.15bn).

With two other companies examining its books and a bidding battle looming, Warner shares cheered 18p to 836.5p.