UPDATE 7-FTSE 100 drops again as US gains fade.

(From FT Investor (Stories))

LONDON (FT.com) - London blue chips ended lower for the fourth consecutive session on Tuesday after stocks on Wall Street failed to hold on to opening gains and war fears and corporate health worries kept weighing on sentiment.

The FTSE 100 traded close to the 3,800 level for most of the session, supported by merger talk and upbeat sales figures from high street retailer Marks and Spencer, but when early gains in the US vanished, London stocks dropped.

Two in three stocks on the FTSE 100 fell and volumes were steady at 2.15bn shares.

The FTSE 100 closed down 1.3 per cent at 3,731.1 and the FTSE Techmark erased early gains to end flat at 610.3. See European markets report

The blue-chip index dropped 49.8 points with the oil and banking sectors accounting for nearly 30 points. The oil majors were sharply lower as Brent crude futures dropped below $28 a barrel. BP and Shell both dropped 2.8 per cent to 412.5p and 385p respectively. November Brent crude fell to $27.60 before recovering some to end down 23 cents at $28.00.

Meanwhile on Wall Street, stocks headed lower after a firmer start. The Dow Jones Industrial Average fell 0.7 per cent and the Nasdaq Composite was 0.5 per cent weaker by the time London closed.