By Dominic Lau
LONDON, March 7 (Reuters) - Britain's FTSE 100 <> index
shed 1.15 percent on Friday, tracking steep falls in U.S. and
Asian markets on fears of a global slowdown triggered by
mounting credit-related losses that weighed on commodities.
By 1120 GMT, the FTSE 100 was down 66.2 points at 5,700.2,
ahead of U.S. February jobs data due at 1330 GMT. The benchmark
index has lost 3 percent this week and nearly 12 percent this
year on concern of a looming U.S. recession.
"We had sharp losses overnight in Asia and the U.S., so we
have a bit of catching up to do," said Richard Hunter, head of
UK equities at Hargreaves Lansdown.
"In terms of the general themes, nothing has really changed.
There is still big concern around continuing fallout from
subprime and what other parts of the economy it might reach."
Other major European indexes fell, and the iTraxx Crossover
Index <ITCRS5EA=GFI>, made up of 50 mostly "junk"-rated credits,
hit a record wide.
Miners were the worst hit on worries of weakening global
demand. BHP Billiton <BLT.L>, Rio Tinto <RIO.L>, Anglo American
<AAL.L>, Xstrata <XTA.L>, Vedanta Resources <VED.L>, Kazakhmys
<KAZ.L> and Lonmin shed between 1.2 and 4.5 percent.
Oil shares also suffered as crude prices <CLc1> edged below
$105 a barrel. BP <BP.L> dipped 0.4 percent and Royal Dutch
Shell <RDSa.L> slipped 1.3 percent.
In spite of the drop, crude futures held near last session's
record highs, which further weighed on sentiment battered by
more instability in credit markets.
Banks were other standout losers, with Barclays <BARC.L>
down 1.8 percent, Royal Bank of Scotland <RBS.L> losing 2.3
percent, Standard Chartered <STAN.L> easing 1.6 percent and HSBC
<HSBA.L> off 0.7 percent.
News that Thornburg Mortgage Inc, a "jumbo" U.S. mortgage
lender, was in default after failing to meet creditor demands
for more upfront cash hit on Thursday.
Adding to the gloom, Carlyle Capital Corporation <CARC.AS>,
an affiliate of private equity firm Carlyle Group [], said
it had received substantial additional margin calls and more
default notices from lenders which could deplete its liquidity.
[]
HBOS SHINES
Mortgage lender HBOS <HBOS.L>, however, advanced 1.2 percent
as an investor roadshow and several positive analyst comments
highlighted its sharp fall since last week's results appeared
excessive, traders said. Lloyds TSB <LLOY.L> was up 0.5 percent.
Friday's main focus for financial markets is U.S. February
non-farm payrolls data, which economists in a Reuters survey
forecast would show 25,000 jobs added last month compared with a
loss of 17,000 in January.
Shares in pubs groups also fell after JD Wetherspoon <JDW.L>
said rising costs meant it was slightly more cautious on the
outlook for its second half, as it met forecasts with a 13
percent fall in first-half profit. JD Wetherspoon was down 10
percent.
Enterprise Inns <ETI.L>, Mitchells & Butlers <MAB.L>, Punch
Taverns <PUB.L> and Whitbread <WTB.L> lost between 1.4 and 3.8
percent.
Yell Group <YELL.L> slipped 3.3 percent to a record low
after UBS cut its price target on the British directories firm
and kept its "sell" rating.
(Editing by David Hulmes)
