FTSE slips by midday led by banks; commodities rise

                                
 * FTSE 100 falls 0.3 pct
                                
 * Firmer commodity prices lift miners and energy stocks
                                
 * Banks fall as concerns over credit crisis impact persists
                                
 * Ryanair results weigh on British Airways, easyJet
                                
 By Dominic Lau
                                
 LONDON, July 28 (Reuters) - Britain's blue chip index dipped
by midday on Monday as banks fell on lingering concerns over the
impact of a credit crunch and Ryanair <RYA.I> results weighed on
British Airways <BAY.L>, while commodity shares gained.
                                
 By 1040 GMT, the FTSE 100 <.FTSE> was down 15.1 points, or
0.3 percent at 5,337.5 amid a flurry of results and trading
updates. The UK blue chip index lost 0.4 percent last week, and
is down more than 17 percent so far this year.
                                
 Heavyweight energy stocks were in demand as crude prices
<CLc1> rose above $124 a barrel, rebounding from a seven-week
low. BP <BP.L>, Royal Dutch Shell <RDSa.L>, BG Group <BG.L> and
Cairn Energy <CNE.L> were up 0.2 to 2.8 percent.
                                
 Miners rose along with firmer metal prices. BHP Billiton
<BLT.L>, Rio Tinto <RIO.L>, Anglo American <AAL.L>, Eurasian
Natural Resources <ENRC.L>, Antofagasta <ANTO.L>, Lonmin
<LMI.L>, Xstrata <XTA.L> and Vedanta Resources <VED.L> put on
between 1.5 and 5.1 percent.
                                
 "We're at an important stage in the market. Last week we
seemed to hit a bit of the bottom and bounce off that," said
Angus Campbell, head of sales at Capital Spreads.
                                
 "The market closed interestingly not as well as one would
have expected. Today is a bit of carry on in sentiment with
banking stocks being worse off and oil prices are a little bit
higher."
                                
 Banks, however, headed in the opposite direction after
credit ratings agency Standard & Poor's said it might cut some
ratings on Fannie Mae <FNM.N> and Freddie Mac <FRE.N> and after
U.S. regulators took over two small banks and sold them to
Mutual of Omaha Bank.
                                
 The U.S. Congress approved a massive housing market rescue
bill on Saturday, offering emergency financing to Fannie Mae and
Freddie Mac, and setting up a $300-billion fund to help hundreds
of thousands of troubled homeowners.
                                
 Royal Bank of Scotland <RBS.L>, HSBC <HSBA.L>, Barclays
<BARC.L>, Lloyds TSB <LLOY.L> and Standard Chartered <STAN.L>
were down between 0.5 and 3.8 percent.
                                
 HBOS <HBOS.L> dropped 6.5 percent ahead of its first half
results on Thursday. A Reuters poll of four analysts expected
HBOS profits to fall by more than half to about 1.3 billion
pounds.
                                
 "When it comes to the UK banking sector, all eyes are going
to be on further credit writedowns. We are going to move into
the interim reporting period starting with Lloyds on Wednesday,"
said Richard Hunter, head of UK equity at Hargreaves Lansdown.
                                
 "We will have a much better picture in the next couple of
weeks as to the health of UK banks."
                                
 Adding to negative sentiment, Citigroup cut European banks
to "underweight" from "neutral".
                                
 And a survey by property consultant Hometrack showed British
house prices fell for a 10th straight month in July to stand 4.4
percent lower on the year. [ID:nL5655594]
                                
 
                                
 AIRLINES DOWN, HOUSEHOLD PRODUCTS UP
                                
 British Airways <BAY.L> shed 4.7 percent after Ryanair
<RYA.I> posted an 85 percent fall in first-quarter net profit as
its fuel bill almost doubled and warned it could make a
full-year loss of up to 60 million euros if oil prices stayed
high and fares fell. [ID:nL8525495]
                                
 Ryanair shares listed in London <RYA.L> slumped nearly 14
percent, while mid-cap easyJet <EZJ.L> sank 6.5 percent.
                                
 Unilever <ULVR.L>, however, strengthened 1.9 percent. The
world's third-biggest consumer goods group said it had agreed to
sell its North American laundry business to private equity firm
Vestar Capital Partners for about $1.45 billion. [ID:nL8185468]
                                
 Reckitt Benckiser <RB.L> advanced 2 percent after the
world's biggest household cleaning goods maker posted an 11
percent rise in second-quarter profits and said it was on track
to meet its full-year sales and profit targets. [ID:nL8544352]
                                
 Pearson <PSON.L> added 1.9 percent after the publishing
group said it was more confident in its full-year outlook after
increasing operating profit 38 percent and sales by 14 percent
in the first half. [ID:nL8540262]
                                
 Mid-cap Detica <DCA.L> soared nearly 18 percent to 439 pence
after BAE Systems <BAES.L> said it had made a recommended offer
for the provider of IT services to the national security sector
at 440 pence per share. BAE Systems was flat.
 (Additional reporting by Michael Taylor; Editing by David
Cowell)