The FTSE-100 sank below the 4,100-point mark today as continued Wall Street weakness and a fall in sales at Cisco weighed on sentiment.
The FTSE 100 closed down 45.1pts at 4075.9 with banks, oils and drugs accounting for 60 per cent of the index movement.
Further declines in early trade on Wall Street, following a sharp loss overnight, had sent London investors running for cover.
US shares have been hit by a feeble response to the first round a three-day Treasury bond auction. With bond prices falling, as prospects of US economic recovery and interest rate rises improving, the first day’s issue was oversubscribed by 1.32 times, compared with the 1.96 times seen at the last sale in May.
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The stock decline saw the Dow Jones Industrial Average fall back below 9,000 points within an hour’s trading today.
In London, financials were among the worst hit, with Barclays and Lloyds down 2 per cent, and Prudential shedding 3 per cent.
Standard Chartered lost 3 per cent despite posting above-forecast results.
Media stocks, one of the best performers in recent weeks, also lost ground as temptation to take profits rose. Reuters lost 5 per cent, with Pearson 3 per cent lower.
Telecoms shares were dragged lower by Nasdaq losses overnight, with BT down 3 per cent, Cable & Wireless down 2 per cent and Vodafone easing 1 per cent.
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The few gainers included Smith & Nephew, up 5 per cent on after it refused to raise its offer for Centerpulse.
Analyst comment helped Hanson edge higher.
Outside the FTSE 100, Capita slid 2 per cent on reports that it had lost out on a £2.3 billion IT outsourcing contract with the National Health Service.
The spurning of tech stocks saw ARM Holdings slide 5 per cent, with Autonomy shedding 3 per cent.
Spirent, the telecoms equipment group, lost 3 per cent despite posting results better-than-expected interim results.
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For more markets news read The Times tomorrow.