Marks & Spencer featured on the upside in London after releasing better-than-expected fourth-quarter figures.

But the FTSE 100 closed down 50.5 at 6016.5 following a slump on Wall Street triggered by worries that crude oil prices would hurt consumer spending and limit corporate profits.

All the broader FTSE indices were also weaker, while volume remained modest, with 2.823 billion shares changing hands in 335,054 deals.

American markets had started brightly after strong quarterly results from Alcoa and Micron Technology, and comments from Nokia that it sold more higher-profit mobile phones in the first quarter. But as crude-oil futures climbed above $69 a barrel on continued concern about supplies, the positive sentiment quickly faded.

Oil traders have been spooked that Iran might be attacked over its nuclear ambitions. Iran is the world’s fourth largest oil exporter.

By London's close the Dow Jones was down 38.0 points at 11,103.00, while the Nasdaq was 17.19 points weaker at 2,316.10.

Buyers drive metals markets

Copper today hit record highs, testing the $6,000 a tonne level. News that Grupo Mexico had declared force majeure due to strikes at its Mexican mines lent support to the red metal, taking its gains to more than 35 per cent since the new year.

In early morning trade, London Metal Exchange copper for delivery in three months was up $75 at $5,985/$5,995 a tonne. LME copper earlier hit a record $5,990/$6,000.

"It’s hard to see sellers in the market," one dealer told Reuters.

Meanwhile, gold hit $600 an ounce for the first time since 1980 on strong buying interest from investment funds. The metal has gained 16 per cent in 2006 and 41 per cent in the past 12 months. It touched $603 an ounce overnight - its highest level since December 1980 before falling back slightly.

In London, Xstrata was up 31p at 2,005p after Deutsche Bank, Citigroup and Merrill said "buy" and upped targets.

Rio Tinto up 9p at 3,124p was the target of similar attention from analysts. As was BHP Billiton, up 13.5p at 1,155.5p and Anglo American, up 20p at 2,425p.

Antofagasta was buoyed by the firm copper market, up 35p at 2,365p.

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M&S leads London market higher

Marks & Spencer shares moved sharply higher after the retailer beat market expectations, reporting a 6.8 per cent increase in fourth-quarter sales.

By the close M&S shares were 4 per cent or 22p higher at 586p.

The UK’s largest retailer said like-for-sales in general merchandise, such as clothing, were up 8.2 per cent. A general slowdown in consumer spending since January has harmed sales at chief rival Next, but M&S appears to have come through relatively unscathed.

Seymour Pierce upgraded its recommendation on the stock to "outperform" from "hold", calling the numbers "stunningly good".

It also increased its pre-tax profit forecasts to £752 million from £730 million for 2005/2006, and to £870 million from £790 million for 2006/2007.

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BRC sees blood on the high street

The progress at M&S is in contrast to a general decline on the high street following the worst start to a year for more than a decade.

The British Retail Consortium (BRC) today said like-for-like sales were 1.4 per cent lower in March than at the same stage last year - the biggest fall since July.

The BRC also warned that sales would be flat even if it removed the effect of Easter falling in April this year as opposed to March last year.

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Elsewhere in London

On the second line, Carphone Warehouse lost 3.5p to 310 after warning that its long-awaited entry into Britain’s ultra-competitive broadband market will cost it £110 million in the current financial year.

It also revealed that what it is billing as "free broadband forever" for consumers will come as a package that will cost £21 a month.

However, investors were cheered by the fact that this initial outlay should boost operating profits by between £30 million and £40 million the following year.

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On the downside, Scottish & Newcastle fell 25p to 506.5p after unveiling plans to raise about £210 million via a share placing to help finance its acquisition of the Fosters brand in Europe from Australia’s Fosters Group.

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In Asia, in Hong Kong the Hang Seng Index closed down 45.78 at 16,475.81, while in Tokio the Nikkei 225 closed 38.45 lower at 17,418.13.

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On the economic front

The UK’s trade position deteriorated sharply in February and was revised upwards for January. The Office for National Statistics reported that the deficit in goods jumped to £6.5 billion in February.

Meanwhile, China's trade surplus jumped to $11.2 billion in March from $2.45 billion in February. That took the first quarter trade surplus to $23.3 billion, up 41.4 per cent on a year earlier.

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For Bryce Elder's guide to the forthcoming week's business news, click here

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