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EasyJet shares slip lower

The recent slide in easyJet shares continued today as fears mounted over the impact of rising oil prices and overcapacity in the European market.

The low-cost airline was more than 5% lower in a session when the FTSE 100 Index maintained its recent uncertain streak with a fall of 13.7 points to 6744.1.

There was little impetus from the latest inflation figures for the eurozone, with an unchanged figure of 0.5% doing little to banish fears of a deflationary spiral.

European policymakers are meeting this week but are unlikely to announce any new initiatives after their June meeting saw interest rates slashed from 0.25% to 0.15% in an effort to revive the continent's moribund economy.

The pound held firm against the euro and US dollar - at 1.25 and 1.70 respectively - as new lending figures from the Bank of England showed signs that the housing market is cooling down of its own accord.

Some 61,707 mortgages worth £10 billion got the go-ahead in May, 19% below January's peak of nearly 76,000.

The biggest fall in the FTSE 100 Index came from easyJet as shares in the airline continue to slip back from the recent high seen in April.

A downgrade from Bank of America Merrill Lynch caused the latest sell-off, with the broker cutting its recommendation to underperform and lowering its price target to 1150p from 1800p.

The sector has been spooked by an upward trend for fuel costs and a recent profits warning from Lufthansa in which it warned about the impact on fares from overcapacity on its European routes.

Shares were 73.5p lower at 1385.5p, while rival International Airlines Group was 8p lower at 375.8p.

Elsewhere on the fallers board, shares in Sports Direct International were down nearly 3% - off 19.25p to 704.25p - after it was forced to deny that it planned an offer for shoe retailer Office.

It is also thought to be facing defeat by shareholders over a third attempt to secure a bonus scheme for founder Mike Ashley.

Much of the retail sector was on the front foot, with Debenhams ahead 2.25p to 69.5p and SuperGroup up 19p to 1087p in the FTSE 250 Index.

But Marks & Spencer fell 4.3p to 427.6p after broker Shore Capital warned that next week's trading update from the chain was unlikely to show a shift in momentum in the company's turnaround plans.

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