BAY sees declines on session

Equities markets in London saw declines on Tuesday, with the FTSE 100 down 2.6 percent to 5,479.9 as the FTSE 250 dropped 2.46 percent to 8,920.8.

The declines came on higher oil prices, declining house prices, and a contraction in manufacturing activity.

Travel-related shares saw declines, with British Airways (LSE: BAY) down 5.7 percent and cruise line operator Carnival Corp (LSE: CCL; NYSE: CCL; NYSE: CUK) dropping 4.8 percent.

Other decliners included the pharmaceuticals sector, banks, miners, most real estate groups, and the retail sector.

In Europe, the FTSE Eurofirst 300 was down 2.09 percent to 1,176.2 while the Dax was 1.6 percent lower to 6,315.94, the CAC-40 fell 2.11 percent to 4,341.21, and the IBEX dropped 2.29 percent to 11,770.9.

Telecommunications companies and the utilities sector saw gains, while banks, insurers, retailers, the semiconductors and steel sectors, and banks were all lower on the session.

Several factors sent Asia-Pacific equities markets lower, with Tokyo’s Nikkei 225 coming in with its ninth losing session in a row on low trading volumes.

The Nikkei was down 0.13 percent to 13,463.2 in Tokyo, while the Topix index fell 0.03 percent to 1,320.07 but the Mothers market of small and mid-caps added 1.77 percent to 549.9.

The Tankan index of manufacturing sentiment came in at 5, down from 11 in March, with investors taking to comfort in the fact that it had been predicted to sink to 3 in the second quarter.

Tokyo’s real estate sector was lower after new data from the National Tax Agency showed that land price growth slowed in Tokyo in 2007, while the steel sector declined on news that Asian steel companies have agreed to pay much more for iron ore but utilities were higher after Tokyo Electric (TYO: 9501) said it might raise prices.

Other factors sending regional markets lower included a report that the consumer price index in South Korea was up 5.5 percent in June from the same month in 2007 and news from the China Federation of Logistics and Purchasing that while manufacturing in China expanded in June, it did so at its slowest pace in nearly three years.

South Korea’s Kospi index dropped 0.51 percent to 1,666.46 while in Australia the Sydney Ordinaries fell 1.35 percent to 5,261.1 and the S&P/ASX200 was down 1.46 percent to 5,138.9 although miners and airlines saw gains there.

The Straits Times Index was 1.38 percent lower to 2,906.79, Taiwan’s Taiex fell 1.54 percent to 7,407.98, the Shanghai Composite was down 3.09 percent to 2,651.6, and India’s Sensex dropped 3.71 percent to 12,961.68.

In midday trade in New York, the Dow Jones Industrial Average had dropped 0.73 percent to 11,267.37 while the Nasdaq Composite was down 0.89 percent to 2,272.67 and the S&P 500 was 0.69 percent lower to 1,271.19.

Carmakers were lower on rising prices for gasoline and after Ford Motor (NYSE: F) reported that sales fell by 27.9 percent in June, while home improvement retailer Home Depot (NYSE: HD) saw declines after Merrill Lynch (NYSE: MER; TYO: 8675) downgraded its shares, citing the continuing slump in the housing market.

Losses were limited on Wall Street, however, by an unexpected expansion in US manufacturing activity in June.

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