Confusion surrounding a potential buyout of Northern Rock has seen its shares plummet by over 25% in early trading.
The drop in share value for the bank has dragged the FTSE 100 down 24 points, or 0.4%, to 60.96.
Northern Rock has dropped 26.7p, or 25.62%, to 77.5. It is followed by Friends Provident, which dropped six points, or 3.85%, to 150p. Tullow Oil is also among the morning’s losers, dropping 21.5p, or 3.4%, to 610.5.
Experian was leading the resistance, climbing 11 points, or 2.65%, to 426p. ICAP, up 13p to 584.5p, and Cable and Wireless, up 3.4p, or 1.88%, to 184.3 were also among the early winners.
In the US, the Dow Jones closed down 218.35 points, or 1.66%, to 12958.44.
Altria Group, up 0.66 points, or 0.9%, to 73.84 was the day’s biggest winner. It was followed by McDonalds, up 0.47 points, or 0.81%, to 58.6 points, and 3M Company, up 0.13 points, or 0.16%, to 81.7.
However, losses for GEN Motors, down 2.48 points, or 8.47%, to 26.79, AT&T and JPMorgan Chase overshadowed the day’s winners.
In Japan, the The Nikkei 225 Stock Average climbed 168.96, or 1.1%, to 15,211.52 at the close of trading.
Mitsui, Japan's second-largest trading company, jumped 85 yen, or 3.7%, to 2,390, while Komatsu Ltd., the world's second-largest maker of construction machinery, rose 140 yen, or 4.5%, to 3,260.
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