London share prices in turmoil

Last Modified: 22 Jan 2008
By: Channel 4 News

The City woke up this morning wounded by its losses yesterday. £77bn were wiped of share prices, the biggest slump in six years.

Workers filed into their offices, banks and trading rooms, anxious over exactly how much money they could lose when the markets opened in London and Wall Street.

By 8:29 am the FTSE was down 129.4 points, or 2.3 per cent. It recovered briefly but has been jumping between 1 per cent higher and 1 per cent lower.

Here is the journey London's FTSE 100 index has taken this morning. Falling more than 3 per cent at the opening, it has since recovered and a short time ago stood at 5,597.9, a rise of more than 19 points on the morning.

The slump here has simply followed a series of heavy losses in Asian markets overnight. Japan's benchmark the Nikkei dropped nearly 6 per cent, taking its decline this year to 18 per cent, the biggest fall in 10 years.

The chancellor Alistair Darling briefed his cabinet colleagues on the stock market turmoil this morning.

Gordon Brown MP said: "We have done everything in our power and will continue to do everything in our power to maintain stability of the British economy, by having the Bank of England able to act quickly and having arrangements in place that give us fiscal and monetary stability. "People know that Britain will take all the decisive action that is necessary to ensure that our economy remains as stable as possible."

Wall Street reacted badly to George Bush's so-called economic rescue package on Friday.

It's been a bank holiday in the US so all eyes are now on Wall Street where the markets open at 2.30pm, for the first time since then.