Growth fears send FTSE off the rails

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Britain’s blue-chip share index took a hammering yesterday as profit-taking and fears over the pace of global growth replaced exuberance about the US economy. The benchmark FTSE 100 plunged 134.84 points, or 2 per cent, to 6,627.17, more than wiping out Tuesday’s surge which followed the extended bank holiday weekend.

Investors rushed to seal in gains after the Organisation for Economic Co-operation and Development (OECD) cut global growth forecasts, while weak retail sales figures added to concerns over the UK economy.

There were also sharp declines in France and Germany as the Cac 40 fell 1.9 per cent and Dax dropped 1.7 per cent.

Yusuf Heusen, sales trader at IG, said: “It’s been a while since we’ve seen such volatility in both directions, which is at least a welcome reminder that markets can go down as well as up, but two consecutive triple-digit days suggests a market that doesn’t know whether it’s coming or going.”

Retail giant Marks & Spencer and construction firm Amec were among those suffering in the sell-off, with declines compounded as the two stocks turned ex-dividend. M&S fell 13p to 472p, while Amec dropped 25p to 1,034p.

Energy and utility firms were also under pressure, with National Grid the biggest faller, down 42.5p to 797p and SSE off 59p to 1,569p.

Outside the top tier, banknote printer De La Rue was also in the red after its annual results, down 4.1 per cent or 40p to 946p, despite revealing plans to increase annual cost savings by £10 million.

But retail chain Topps Tiles gained 1.1p to 68p, despite reporting a drop in half-year profits and worsening sales declines in recent weeks.

NEW YORK: US stocks fell on Wall Street last night as high-yielding dividend stocks lost some of their shine after recent gains in US Treasury bond yields.

The Dow Jones industrial 
average dropped 105.59 points, or 0.69 per cent, to end at 15,302.80 while the broader Standard & Poor’s 500 Index lost 11.69 points, or 0.70 per cent, to finish at 1,648.87. The Nasdaq Composite Index fell 21.37 points, or 0.61 per cent, to close at 3,467.52.