BP slide drags FTSE down

London's FTSE 100 Index fought back from hefty falls today, but oil giant BP remained deep in the red after failing again to block the Gulf of Mexico oil spill.

BP suffered a 17% slide at one stage in its biggest one-day shares fall for 18 years, before closing down 13%.

Around £12bn (€14.36bn) was wiped off the company's shares in the sell-off, which dragged the Footsie lower - down 25.1 points at 5163.

BP's nosedive was sparked by news that its latest attempt to "top kill" the leaking oil well had not worked.

The blue chip giant accounts for 7% of the FTSE 100 Index and its woes punished the wider market.

But the top tier pulled back from early session falls of more than 100 points thanks to more positive trading on Wall Street.

US stocks were boosted by good news from the construction and manufacturing sectors, which raised hopes for America's economic recovery.

Gains were much-needed on the Dow Jones Industrial Average after it suffered the worst May since 1962, retreating 7.9% due to anxiety over the eurozone.

Today's better sentiment helped the euro, which clawed its way back from a fresh four-year low against the dollar, trading at around $1.23.

The pound also gained strength against the dollar and was up on the euro, at €1.20.

Mining stocks were impacted by signs of cooling growth in China, with Kazakhmys down 19p to 1166p and BHP Billiton off 38.5p to 1874.5p.

Embattled BP led the declines, however, down 64.8p at 430p with investors fearing the oil spill crisis will not be stopped until August.

Shares have lost a third of their value since the crisis began and one analyst at Arbuthnot said the leak had the potential to "break BP" if the well was not stopped soon and the US government takes tough action.

Fellow oil giant Royal Dutch Shell also saw its shares dented as investors worried over new drilling regulations that are likely to emerge following the Deepwater Horizon disaster. Shares fell 10.5p to 1741p.

Prudential was the biggest riser in the FTSE 100 Index amid signs that its takeover pursuit of AIG's Asian arm AIA may have failed. Shareholders, who criticised the deal as too expensive, saw the stock rise 6% or 34p to 575.5p.

Elsewhere Irish carrier Ryanair rose 8% after the group swung back into profit on lower fuel prices and announced a special €500m which will pocket boss Michael O'Leary €20m.

In the FTSE 250, rival easyJet added 3% or 11.7p to 412.7p.

The biggest Footsie risers were Prudential up 34p at 575.5p, National Grid ahead 5p at 142.3p, British American Tobacco up 72.5p at 2115p and Legal & General up 2.8p at 81.9p.

The biggest Footsie fallers were BP down 64.8p at 430p, TUI Travel down 4.8p at 232.9p, BHP Billiton off 38.5p at 1874.5p and Kazakhmys down 19p at 1166p.