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* FTSE 100 index down 0.6 percent
* Pearson shares sink after update
* Energy shares track weaker oil prices
By Atul Prakash
LONDON, Oct 17 (Reuters) - Education company Pearson led Britain's top share index lower on Monday after saying in an update that market conditions continued to be challenging.
The blue-chip FTSE 100 index was down 0.6 percent at 6,970.30 points by 0859 GMT after climbing to a record high last week. Britain's mid-cap index was down 0.66 percent.
Pearson was down 9.3 percent after reporting a 7 percent drop in its nine-month organic sales and saying that retailers had further corrected their inventory demands in July and August.
"Pearson is now relying on its core educational businesses for forward momentum, but convincing customers to continue paying for its content represents a huge challenge to the group against a backdrop of free educational resources popping up online," Hargreaves Lansdown analyst George Salmon said.
"Despite enjoying the benefits of a weaker pound, sales have been falling recently and there was little in today's update to suggest that the tide is changing."
Energy shares also lost ground after oil prices fell, pulled down by a rising rig count in the United States, a strong dollar and record OPEC output, which comes amid slowing global economic growth that could erode fuel demand.
The UK oil and gas index fell more than 1 percent in early trade, the top sector decliner, dragged down by a 0.9 to 1.3 percent fall in shares of BP, Royal Dutch Shell and Tullow Oil.
However, miners rose after prices of copper gained. Glencore, Rio Tinto and Anglo American rose 0.5 to 1.6 percent, helping the UK mining index to advance 0.5 percent.
Among mid-cap companies, Debenhams fell nearly 4 percent after Morgan Stanley downgraded its rating on the stock to "equal-weight" from "overweight". (Reporting by Atul Prakash; Editing by Mark Trevelyan)