Listed UK companies held their value until the last hour of trading when fears of higher interest rates in the US started driving down shares after the opening there, leading the FTSE 100 to a 39.40 points fall to 4,424.70.
Yesterday’s Federal Reserve interest rate hike coupled with news today of record US private sector house building sent investors back to the calculators to decide when the next rate increase might come.
Some 84 FTSE 100 stocks made losses by the close.
Sainsbury led the fall after announcing this morning its chairman was leaving, sending shares down 16.25p to 268.5p.
Reuters suffered an analyst downgrade, ending the day down 15p at 355.5p. United Utilities shed another 10p to 508.5p after losing ground for the third day in a row.
Higher interest rates have hit confidence in banking profits.
Abbey slid 17.25p to 496p, while Bradford & Bingley ended down 8p at 270.5p.
Northern Rock lost 17.5p to 706p.
Centrica gained 11.5p to 236p on news of the successful sale of its AA business for £1.75bn to a private equity group, providing some rare light in an otherwise dour day for the markets.
British Airways added 3.25p to 278.25p. The company has made gains in six out of the past nine trading days on the stock exchange.
The FTSE 250 shed 37.9 points to 62,40 after a shock profits warning from Colt Telecom.
The phone services company dropped 27.25p, or more than 33%, to 53p after warning it would not meet earnings and profits expectations when it next reports results, citing continued tough market conditions.
US markets are down so far today.
The Dow Jones Industrial Average index has shed about 117 points to 10,316, while the broader S&P 500 index is down about 14 points to 1,126.IFAonline
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