4:30 PM London – The UK indexes slid and crude oil was in focus as the European markets turned cautious as Greek negotiations dragged on. Retail sales in the United Kingdom eased in January. BP quarterly net soared 38% and GlaxoSmithKline swung to profit.

The UK indexes slid on the ongoing Greek crisis and merger deal between Glencore and Xstrata faced resistance from key investors. Crude oil market was volatile as tension rose in the Middle East after the U.S. imposed tighter and wider sanctions on Iran.

French President Sarkozy and German Chancellor Angela Merkel in a joint interview with ""France 2"" television warned the Greek politicians needed to come to a resolution soon as time was running out.

Greece is on the verge of a default if it is unable to repay €14.5 billion in bonds on March 20 however investors anticipate a last minute deal at the end of this week to avoid involuntary default.

EU officials set February 15 as the deadline for the approval of austerity measures. However Greek political parties are at odds in agreeing to labor reforms demanded by the troika. At least three separate strikes were called in Athens today and most of the transportation network was grounded to a halt.

In London trading FTSE 100 Index declined 14.30 or 0.3% to 5,878.33 and the pound edged higher to $1.5825.

UK Retail Sales Ease

Retail sales in the United Kingdom decreased 0.3% in January on a like-for-like basis compared to the 2.3% rise in January 2011, the British Retail Consortium reported today.

The BRC-KPMG Retail Sales Monitor reported total sales rose 2.1% on year.

Non-food non-store sales climbed 11.3% on year in December 2011 compared to an 18.5% on-year gain in December 2012.

Glencore and Xstrata Confirm Agreement

Switzerland based Glencore International agreed to acquire London listed Xstrata for £39.1 billion in the largest mining industry merger.

Glencore valued the Xstrata at 1,290 pence a share and it will control 55% of the newly merged entity Glencore Xstrata International Plc. The combined entity will have $209 billion in revenues and will rival with the two largest Australian mining giants BHP Billiton and Rio Tinto.

The merger values each Xstrata share at 1,290.10 pence, representing a premium of approximately 15.2% to Xstrata’s closing share price of 1,119.50 pence on February 1, the last business day prior to the announcement by Xstrata that it was in discussions with Glencore.

However, the deal is far from done and may face intense antitrust scrutiny from regulators in Australia, UK, EU and Switzerland.

The combined company will have 15% share of world zinc market and 32% share of thermal coal market. However, two key minority investors voiced their reservation for the deal and held out for higher price from Glencore.

Gainers & Losers

BP plc fell 1.6% to $46.10 after the oil and gas explorer reported fourth quarter total revenues and other income grew 15% to $96.34 billion from $83.99 billion in the comparable period. Profit for the quarter increased 38% to $7.69 billion or 39.99 cents a share from $5.57 billion or 29.28 cents a share last year.

For the full-year 2011, total revenues and other income advanced 25% to $386.46 billion from $308.93 billion. Profit for the year was $25.7 billion compared to a loss of $3.72 billion last year.

The company announced a 14% increase in its quarterly dividend to 8 cents per share for the fourth quarter.