24 August 2005, 12:19  London shares open lower, hit by weak miners as BHP Billiton fails to inspire

Leading shares opened lower this morning, with continued high oil prices and weakness across the mining sector weighing on sentiment in an otherwise quiet morning, dealers said. By 8.15 am, the FTSE 100 index was down 11.9 points at 5,288.3, while the broader indices were also weaker. US stocks closed lower on Wall Street last night, after an indecisive session during which investors assessed a larger-than-expected drop in monthly existing home sales, fluctuating energy prices and more management turmoil at Citigroup, traders said. The Dow Jones Industrial Average closed down 50.31 points at 10,519, while the Nasdaq Composite Index was down 4.16 points at 2,137. Across Asia, the Nikkei 225 index began its afternoon session 31.62 points lower at 12,441.31, while the Hang Seng was down 56.67 points at 14,917.22 by midday. Oil prices climbed above 66 usd a barrel in Asian trade as the market awaited the weekly petroleum inventory report from the US. New York's main contract, light sweet crude for delivery in October, was trading at 66.18 usd a barrel, up 47 cents from its close of 65.71 usd in the US overnight. The US Department of Energy is expected to release the weekly inventory report later today amid expectations it would show a rise in crude stocks. In London, BHP Billiton fell 25 pence to 810 in opening deals as the group's uninspiring full year numbers gave investors an excuse to take profits after recent gains. The mining giant exceeded market expectations by reporting a 6.512 bln usd net profit, and said it expects further earnings growth as it benefits from strong demand and prices for the commodities it produces. Merrill Lynch reiterated its 'neutral' stance however, arguing that although the results were a touch above its expectations, overall group EBIT was 9.33 bln usd, 2.3 pct below its forecasts, while the group's outlook for Europe remained challenging.

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