Shares take fright over Libya turmoil

 
Steve Dinneen
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THE FTSE 100 closed at a two-week low yesterday after another day of chaos in Libya sent investors running for cover.

The blue-chip index shed 1.1 per cent to close at 6,014.8 as fears over energy supplies sapped investor’s appetite for risk. Shares of blue-chip firms across Europe felt the bite, with banks and miners taking the biggest hit.

Educational publisher Pearson, whose fifth biggest shareholder is the Libyan Investment Authority, lost 2.46 per cent.

Lloyds Banking Group and Royal Bank of Scotland, which are set to report results later this week, shed four per cent and 3.9 per cent respectively.

The FTSE 100 volatility index, a barometer of investor anxiety, jumped a staggering 17 per cent.

UniCredit was among the biggest losers in Europe, falling 5.75 per cent thanks to Libya’s central bank and sovereign wealth fund owning a combined 7.5 per cent of the Italian bank.

Other Italian firms with exposure to Libya, including Finmeccanica, UBI Banca and Intesa SanPaolo, also took big hits.

Shares in Italy’s biggest multinational, the oil firm Eni, were down 5.1 per cent, while the country’s blue-chip FTSE MIB index ended down 3.6 per cent, wiping €14bn off its market capitalisation in its worst session for eight months.

Austria’s largest industrial, the oil firm OMV, was down 4.2 per cent. OMV, along with other foreign oil firms operating in Libya, including Statoil, BP and Total, said they have evacuated all non essential staff.

Oil production was ceased by Statoil but Total and Eni said their operations had not been hit. BP, which struck a £900m deal with Gaddafi in 2007 but only has exploratory operations in Libya, said it has stopped drilling. MARKETS: P18

Discontent spreads in Arab world
What happened where

MOROCCO
Sporadic outbursts of violence broke out yesterday after mass protests over the weekend.

Thousands of protesters took to the streets in Morocco on Sunday demanding King Mohammed give up some of his powers.

TUNISIA
Washington has offered Tunisia help in shoring up security following its revolution.

Elections to replace Ben Ali are expected by July or August. But new protests have erupted in recent days against the interim government.

LIBYA
A second fierce night of violence in Tripoli as protesters are met with heavy arms fire.

Reports suggest that much of the country has slipped from Gaddafi’s grip, as Libya’s deputy envoy to the UN calls on him to quit.

KUWAIT
More than 1,000 protesters clashed with security forces in the province of Al-Jahra over the weekend.

120 demonstrators were arrested and 30 required medical treatment.

IRAN
Security forces hit out at protesters in Tehran as thousands of officers attempted to drown the unrest.

The streets were said to be quiet last night with no reported deaths.

ALGERIA
Around 5,000 students took to the streets of Algiers, in the face of a public ban.

They are protesting about new laws that dilute their academic qualifications, as well as more general discontent with the government.

EGYPT
David Cameron made the first visit to Egypt by a foreign leader since the overthrow of Hosni Mubarak.

Egypt's public prosecutor moved to freeze the foreign assets of Hosni Mubarak, the first sign that the deposed president would be held to account by new rulers.

BAHRAIN
Standard and Poor's lowered its long- and short-term sovereign credit ratings for Bahrain over concerns the political unrest of the past week will persist.

Bahrain Grand Prix organisers cancelled the 13 March opening race of the Formula One season.

OMAN
Mostly-peaceful protesters are demanding political reforms and better pay.

People gathered in Ruwi, a commercial district in the capital, after daily prayers and chanted "we want democracy".

YEMEN
Shots were fired at a demonstration in the capital Sanaa on the ninth consecutive day of unrest.

Thousands are demanding the departure of President Ali Abdullah Saleh, who has called for dialogue. But the coalition of main opposition parties said there could be no dialogue with "bullets and sticks and thuggery".