Britain's top shares fell deeper into the red on Wednesday as heavyweight oil companies such as BP fell, accounting for about half of the damage after crude oil prices traded at 4-month lows, and as earnings from supermarket group Sainsbury disappointed, Reuters reported. By 1045 GMT the FTSE 100 share index was down 42.7 points at 5,396.3, taking its loss in the past two sessions to more than 1 percent. Losses in oil companies BP, Royal Dutch Shell and BG Group wiped about 21 points off the benchmark index as dealers brace for a fresh increase in U.S. oil inventories amid unseasonally warm weather. The Energy Information Administration will release inventory levels for the week at 1530 GMT. Mining stocks also cluttered the list of blue-chip fallers, with Anglo American , Rio Tinto and Xstrata each losing more than 2 percent as investors locked in some of the sector's recent gains. Sentiment in the sector was rattled by a steep fall in copper prices in the wake of news that China's State Reserve Bureau is seeking permission to export 200,000 tonnes. The bureau is at the centre of market speculation that one of its traders has built a potentially costly short position of between 100,000 and 200,000 tonnes of copper on the London Metal Exchange. The index of Britain's leading shares pulled back slightly from an earlier fall to 5,391.7 points after some market participants took the Bank of England's November Inflation Report as suggesting that the next interest rate move is more likely to be a cut. Shares in Sainsbury were among the top index's biggest fallers, down 2.4 percent at 284-3/4p after the company posted profits that were just short of expectations. "The current valuation is pricing in upgrades, which we do not think will happen," analysts at brokerage Panmure said in a note. "Indeed, we believe that the opposite is more likely, as the consumer downturn bites." "The shares are pricing in a recovery that might not happen and they are not particularly supported by assets," it adds. The biggest blue-chip faller was, down 3 percent at 757-1/2 pence, albeit on scant volume of 1.2 million shares. Dealers said a large institutional seller was behind the fall. --mor 1502 Local Time 1202 GMT
