FTSE closes at 6191.6

Updated 17.52 Tue May 20 2008

Fears over US inflation and record oil prices hit the FTSE 100 Index hard, causing it to close 184.9 points down at 6191.6.

The London market had been surging to a five-month high, but took a dive after profit taking in early session trading, followed by oil prices spiking to yet another record of nearly $130 a barrel.

Winners: British Land up 8.5p at 796.5p, Alliance & Leicester ahead 4.25p at 434.5p and HBOS up 2.75p at 465.25p

The US government also reported that higher energy and food prices might be seeping into other parts of their economy.

Sharp falls for heavily weighted miners added to the declines in London, while retailers also suffered after a poor reception to full-year figures from Marks & Spencer.

The group's £1 billion annual profits haul failed to inspire shares, with analysts preferring to factor in the likely impact of tougher trading conditions on this year's performance.

M&S shares tracked the wider London market lower, with the shares down by 5 per cent or 21p at 396p. And the rest of the retail sector mirrored its performance, with rival Next down 64p at 1220p and B&Q owner Kingfisher off 6.2p at 139.9p.

Among the mining stocks in retreat, BHP Billiton dipped 173p to 2023p and Kazakhmys dropped 151p to 1792p, both down 8 per cent.

Elsewhere, Embassy owner Imperial Tobacco's shares were on the back foot, down 163p to 2455p, after announcing plans for a £4.9 billion heavily-discounted rights issue in order to pay down debt on its acquisition of Spain's Altadis.

One of the bright spots came from the banking sector as investors eyed some value following recent gruelling sessions.

Alliance & Leicester recovered 4.25p to 434.5p, while Halifax Bank of Scotland added 2.75p to 465.25p and Royal Bank of Scotland lifted 2p to 254p. Bradford & Bingley, which suffered in the wake of negative analyst comment on Monday, rose 1.25p to 110.75p.

Property group British Land was also one of only three FTSE 100 share risers, ahead 8.5p at 796.5p after offering a glimmer of hope in the embattled real estate sector with news that the pace of decline in prices had started to slow.

Winners: British Land up 8.5p at 796.5p, Alliance & Leicester ahead 4.25p at 434.5p and HBOS up 2.75p at 465.25p.

Losers: BHP Billiton down 173p at 2023p, Kazakhmys off 151p at 1792p, Eurasian Natural Resources down 111p at 1424p and Rio Tinto off 485p at 6593p.