* Metals, oil prices dip
* Weak manufacturing, mortgage data deepens economic gloom
* Banks fall, pressured by sliding UK property market
By Simon Falush
LONDON, Dec 1 (Reuters) - Britain's leading share index fell
2.3 percent by midday on Monday as demand worries dented
commodity prices, dragging down miners and energy stocks, while
weak data highlighted problems facing the UK economy.
By 1119 GMT the FTSE 100 <> was down 97.11 points to
4,190.90 after gaining 1.5 percent on Friday and 13.4 percent
last week, its best ever weekly performance.
British mortgage approvals fell in October to match their
lowest levels since the data series began a decade ago and
mortgage lending was also much weaker than expected.
[]
British manufacturing shrank at a record pace in November
after a collapse in new orders, purchasing managers' data from
Markit/CIPS showed on Monday. []
"The gloomy economic data is continuing to cast a pall over
markets, which is bad because it could be argued that one of the
indicators that we're past the worst will be when markets no
longer respond negatively to bad news," said Jeremy
Batstone-Carr, head of private client research at Charles
Stanley. "Yet they are continuing to do so."
Energy stocks fell as oil prices <CLc1> slid more than $2 to
$52 per barrel after producer cartel OPEC decided to delay a
decision on a third supply cut until its next meeting in
December as economic woes squeeze oil demand.
Royal Dutch Shell <RDSa.L> slipped 1.4 percent, BP <BP.L>
fell 1.6 percent and Cairn Energy <CNE.L> slid 2.8 percent.
MINERS DROP
Fears of slowing demand also hit mining stocks.
Xstrata <XTA.L> slid 6.2 percent after it suspended more
ferrochrome production due to weak market conditions, while Rio
Tinto <RIO.L> fell 3.1 percent, and Antofagasta <ANTO.L> lost
3.3 percent.
Banks were under pressure as fears of the health of the
sickly UK housing market added further pressure to the
beleaguered sector.
House prices in England and Wales fell by 1.1 percent in
November to take them 8.1 percent lower on a year ago, property
consultancy Hometrack said in its monthly survey.
Barclays <BARC.L> fell 3.7 percent, Standard Chartered
<STAN.L> lost 4 percent and HSBC <HSBA.L> fell 1.7 percent.
Meanwhile, the outlook for British manufacturers has
deteriorated significantly over the last quarter, a survey
carried out by the Engineering Employers Federation showed on
Monday, warning conditions in 2009 are set to be some of the
toughest for two decades.
Further, heavy discounting by Britain's retailers has failed
to boost shopper numbers and the rate of business failures in
the industry is accelerating, surveys by researchers Experian
showed.
Kingfisher <KGFL.L>, Marks & Spencer <MKS.L> and Next
<NXT.L> fell between 4.7 and 6.1 percent.
The deteriorating economic environment has put pressure on
global central banks to ease monetary policy.
Investors will eye interest rate decisions this week from
both the Bank of England and the European Central Bank, with
both expected to deliver further easing in monetary policy on
Thursday.
(Additional reporting by Nicholas Vincour; Editing by David
Cowell)
