Britain's FTSE edges lower tracking oil price

* FTSE 100 down 0.5 pct

* Energy stocks track oil price

* Prudential (SES: K6S.SI - news) falls on change in management

* BT gains on upbeat Q3 results

By Kit Rees

LONDON, Feb 1 (Reuters) - UK shares fell on Monday as Chinese data disappointed investors and a depressed oil price placed energy stocks in the spotlight, weighing on the commodity-heavy FTSE 100 index.

Downbeat data showing China's giant manufacturing sector contracted at its fastest pace in almost 3-1/2 years in January reignited fears about its slowing economy, the world's second-largest and an engine for global growth.

China's official Purchasing Managers' Index (PMI) marked a sixth consecutive month of contraction in factory activity, highlighting a disappointing start to the year in sectors such as steel and raising concerns about demand for energy.

Shares (Berlin: DI6.BE - news) in British oil and gas companies came under pressure as oil prices slipped again, with BP falling 1.8 percent following a target price cut from Exane BNP Paribas. The broker also cut its target price on Royal Dutch Shell (Xetra: R6C1.DE - news) , which retreated 1 percent.

Both firms also saw target price cuts from Deutsche Bank (Other OTC: DBAGF - news) , although some maintained that they were relatively well positioned in the energy sector.

"If you are going to be in a big oil company during this downturn within the oil market, you may as well be in ... a bigger oil company like ... your BPs, who actually have their profits cushioned, almost like an internal hedge," said David Madden, market analyst at IG (LSE: IGG.L - news) .

Also among the top fallers was financial services group Prudential, down 3.4 percent following the retirement of its executive director Michael McLintock. He will succeeded by Anne Richards later this year, subject to regulatory approval.

Britain's blue-chip FTSE 100 index was down 0.5 percent at 6,052.46 points by 0941 GMT, underperforming the broader European market.

In positive territory, communications services company BT rose 3 percent after posting its best revenue growth for seven years in the latest quarter, thanks to strong performance in consumer broadband.

The company now finds itself in a strong position to incorporate mobile market leader EE in a restructuring following the close of the deal on Friday.

"With (BT's) acquisition of mobile network operator EE now complete, the company is poised to further strengthen its position as the dominant player amongst the retail, business and wholesale market," Manoj Ladwa, head of trading at TJM Partners, said in a note.

The FTSE 100 is down around three percent since the beginning of 2016. (Editing by Catherine Evans)