* FTSE 100 slips 0.6 pct
* Banks sag on renewed credit worries
* Miners aided by firmer metal prices offer some respite
By Dominic Lau
LONDON, Aug 21 (Reuters) - Britain's FTSE 100 <> fell
0.6 percent by midday on Thursday as renewed credit jitters hit
banking stocks, though miners buoyed by firmer metal prices
offered some support.
By 1027 GMT, the UK benchmark was down 29.9 points at
5,341.9, after rising 1 percent on Wednesday to snap a
three-session losing run.
Banks took nearly 20 points off the index on renewed credit
jitters. Barclays <BARC.L>, Royal Bank of Scotland <RBS.L>, HSBC
<HSBA.L>, HBOS <HBOS.L>, Lloyds TSB <LLOY.L> and Standard
Chartered <STAN.L> shed between 1.3 and 3 percent.
On Wall Street on Wednesday, Fannie Mae <FNM.N> and Freddie
Mac <FRE.N> shares plunged to their lowest levels in almost 20
years, while the mortgage companies' bonds rallied on the belief
an increasingly likely government bailout would wipe out
shareholders but secure their massive debt.
The Financial Times also reported U.S. investment bank
Lehman Brothers had held talks on a sale of up to half its
shares with China's CITIC Securities as well as with state-owned
Korea Development Bank, but both investors walked away saying
the price was too high.
CITIC Securities, however, said it had held no formal talks
about buying a stake in Lehman. []
"It's still stemming from the U.S. and worries over there
surrounding GSEs (government-sponsored enterprises) are
certainly having an effect on the financial stocks over here,"
said Martin Slaney, head of derivatives at GFT Global Markets.
"It's affecting people's confidence. Today's retail sales
figures should have been a boost to the index overall but it
hasn't even been a ripple."
British retail sales unexpectedly jumped in July even as
prices rose at their fastest rate in a decade, official data
showed, calling into question the scale and speed of the
consumer slowdown.
Retailers, however, remained in the red but had pared
earlier losses, with Marks & Spencer <MKS.L> losing 3 percent,
Next <NXT.L> off 0.4 percent and Sainsbury <SBRY.L> dipping 0.8
percent.
Associated British Foods <ABF.L> was down 2 percent after
Citigroup cut its price target on the stock and kept its "sell"
rating.
MINERS LEND SUPPORT
Mining shares rose on firmer metal prices and after Eurasian
Natural Resources <ENRC.L> posted a 160 percent jump in
half-year earnings per share on strong metal prices and higher
output.
ENRC shares gained 2.8 percent, while BHP Billiton <BLT.L>,
Xstrata <XTA.L>, Rio Tinto <RIO.L>, Anglo American <AAL.L> and
Kazakhmys <KAZ.L> added between 0.8 and 2.5 percent.
Mid-cap Imperial Energy <IEC.L> advanced nearly 5 percent
after India's Business Standard said a government panel has
approved India's state-run Oil and Natural Gas Corp's $3 billion
bid to buy the Russia-focused oil firm.
Reed Elsevier <REL.L> added 1.3 percent after German
publishing house Gruner + Jahr said it was part of a second
round of bidders interested in buying the Anglo-Dutch
publisher's trade magazines unit. Gruner + Jahr is owned by
media group Bertelsmann [].
Mid-cap housebuilder Persimmon <PSN.L> leapt more than 12
percent on short covering after its first-half results were not
as bad as some had expected, traders said.
The company reported a 64 percent fall in first-half pretax
profit and cut its dividend to 5 pence per share from 18.5
pence, due to very difficult market conditions.
Within the sector, Taylor Wimpey <TW.L> soared 4.9 percent
and Barratt Developments <BDEV.L> climbed 7.3 percent.
(Editing by Sue Thomas)
