* FTSE down 0.8 pct
* Miners, oils fall along with commodity prices
* Utilities gain on bullish HSBC note
By David Brett
LONDON, Oct 12 (Reuters) - Britain's top shares fell by
midday on Tuesday, as above-target inflation and slowing retail
sales added to worries that potential currency intervention in
China could hurt economic recovery.
Mining and energy stocks were among the biggest fallers,
dropping in step with commodity prices, while utilities were the
main support, boosted by a bullish broker comment.
By 1056 GMT the FTSE 100 <> was 43.27 points or 0.8
percent lower at 5,629.13, having touched its lowest in a week
after it added 0.3 percent on Monday.
British inflation held steady well above its target in
September, as separate surveys showed retail sales growth
slowing and house prices falling fast, highlighting the opposing
forces facing the Bank of England.
The British Chambers of Commerce urged the Bank of England
to inject more stimulus to protect the recovery from budget
spending cuts. []
"It's a market in which investors are concerned about the
macro environment, quantitative easing is looming, and there is
the threat of trade issues, certainly between China and the
United States," Peter Dixon, UK economist at Commerzbank said.
Water company Severn Trent <SVT.L> climbed 0.5 percent and
mid-cap peer Pennon <PNN.L> added 1.6 percent as HSBC raised its
respective recommendations on both firms saying UK water offers
a stable outlook with yield visibility to 2015.
United Utilities <UU.L>, however, fell 0.5 percent as the
same broker cut its rating to "neutral" from "overweight".
"There's no good news. It's all indifference ... the only
sector that is really any good today is the utilities but that
is a very typical flight to quality," David Buik, senior partner
at BGC Partners, said.
COMMODITY RETREAT
UK blue-chips echoed falls overnight in Japanese equities
<> as investors fretted about possible currency
intervention there, as the yen rose to fresh 15 year highs
against the dollar.
Lonmin <LMI.L> and BHP Billiton <BLT.L> were among the top
fallers, down 2.1 and 1.9 percent respectively, as metals
slipped back across the board, with traders citing technical
factors.
Oil prices slipped for a second day on Tuesday, to around
$81 a barrel after Saudi Arabia signaled OPEC would maintain
current production levels at the group's meeting and as the
dollar rallied against the euro.
Oil major BP <BP.L> and Royal Dutch Shell <RDSa.L> each
dropped 1.2 percent.
Oil exploration stocks were dealt a sobering blow as mid-cap
Soco International <SIA.L> plunged 18.6 percent on news that it
would abandon its Vietnamese appraisal well.
Banks were also weaker as investors shied away from riskier
assets with Barclays <BARC.L> the top faller in the sector, down
1.5 percent.
Standard Chartered <STAN.L>, however, bucked the sector
trend rising 1.8 percent with traders citing talk that JPMorgan
<JPM.N> is interested in making a takeover approach.
JP Morgan and Standard Chartered both declined to comment.
In the U.S., Wall Street stock index futures pointed to a
lower open on Tuesday as investors awaited third-quarter results
due from Intel <INTC.O>, and the release of minutes from the
U.S. Federal Reserve's Sept. 21 meeting.
