* FTSE down 0.3 pct on double-dip fears, light volumes
* Banks fall as risk appetite wanes
* Miners down with commodity prices
By David Brett
LONDON, Aug 20 Banks and miners led Britain's
top share index lower on Friday as nagging worries over the
sustainability of the economic recovery and lighter-than-usual
turnover weighed on the FTSE.
The FTSE 100 .FTSE closed down 16.01 points or 0.3 percent
at 5,195.28, its lowest close since July 20, having ended 1.7
percent lower on Thursday.
Banks fell as appetite for risk remained suppressed after
Thursday's data showing new U.S. jobless claims scaled a
nine-month high dented confidence. [ID:nN19350083]
Barclays (BARC.L) dropped 0.6 percent and Royal Bank of
Scotland (RBS.L) was down 2.3 percent.
"In the absence of any economic data to turn sentiment
around ... concerns about a double-dip recession in the U.S.
continued to dominate," Michael Hewson, market analyst at CMC
Building supplies group Wolseley (WOS.L), which gets a large
proportion of its revenue from the United States, was among the
top fallers, down 3.3 percent.
London's blue chips, which have shed 1.3 percent this week
-- their second consecutive weekly fall -- traded just 68
percent of their average 90-day volumes on Friday.
"We are now deep into the main holiday month which means
that there are minimal volumes in the market," Joshua Raymond,
Market Strategist at City Index said.
"As a result, many moves are being overly exacerbated."
Raymond said the FTSE needed to stay above the near-term
support level of 5,178, where he has seen clients leave a number
of buy orders hoping to capitalise on any small recovery. A fall
below there could take the UK Index down to 5,104.
Mining stocks were also mostly lower, dragged down by
Eurasian Natural Resources ENRC.L slipped 2.0 percent
after Citigroup cut the stock to "hold" from "buy" on valuation
Energy shares were higher, helped by BG Group BG.L, which
rose 6.0 percent. Traders pointed to the Daily Mail's market
report which reported speculation that Royal Dutch Shell
(RDSa.L) is considering a takeover bid of the gas producer.
Among midcaps, Dana Petroleum DNX.L added 6.1 percent
after state-run Korea National Oil Corp (KNOC) made a hostile
$2.9 billion cash bid for the company. [ID:nTOE67J00I]
"We are having one of the busiest M&A months of August for a
very long time as companies have got a lot of cash that they
don't know what to do with ... as anything looks good value,
people are looking to buy it up," said David Buik, senior
partner at BGC Partners.
Cairn Energy (CNE.L), also involved in M&A activity, added
India's oil minister Murli Deora said his ministry has
sought details on the proposed acquisition of a majority stake
by Vedanta (VED.L) in Cairn India (CAIL.BO), the local arm of
Britain's Cairn Energy. Vedanta fell 1.5 percent.
Inmarsat (ISA.L), which jumped on Wednesday after activating
a deal with U.S. peer LightSquared continued to pare gains,
falling 2.6 percent.
(Editing by Louise Heavens)