Low oil price pushes markets down

Stock markets have seen large falls as weaker oil and metal prices weighed on commodity stocks, and a World Bank report dampened sentiment.

In the US, the Dow dropped 2.4%, while German and French markets both shed 3%.

London's FTSE 100 fell 2.6%, with mining shares weighing on the index. Oil giants BP and Shell also saw falls after oil dropped below $67 a barrel.

The World Bank said it expected the economic growth of developing countries to slow this year.

It expects GDP in developing countries to grow by just 1.2% this year, compared with 5.9% in 2008 and 8.1% in 2007.

"The World Bank's forecast is certainly playing a role," said Luc Van Hecka, chief economist at KBC Securities.

"People were becoming perhaps a bit too complacent that most of the difficulties with the financial crisis were behind us. I see some cautious forces here and there."

Falling commodities

On Wall Street, the Dow Jones index closed 200.7 points lower at 8,339.

Russia's main stock index, the Micex, fell 8% as it felt the impact of falling oil prices, which make up a large part of Russia's economy.

US light, sweet crude oil dropped $2.62, settling at $66.93 a barrel.

In the UK, BP shares declined 3.8% while shares in Royal Dutch Shell lost 4.7% of their value.

The FTSE 100 index closed down 2.6% at 4,234.

Mining stocks also saw heavy falls, pushed down by lower metal prices. Vedanta was the biggest faller, dropping 8.4%.

In France, steelmaker ArcelorMittal fell 6.9%, while in the US, aluminium firm Alcoa was down 8.9%.