FTSE drops below 5,000
The FTSE 100 index of leading UK shares has fallen below the 5,000 level for the first time since October 1998.
The index last dropped below 5,000 when world stock markets were still in shock after the Asian economic crisis.
Worse than expected unemployment levels in the US have triggered sharp falls in stock markets around the world.
A host of profits warnings from major US companies have added to the gloom. The US Federal Reserve has repeatedly cut interest rates in the bid to stave of recession. Asian and other European markets have also declined this morning.
After little more than two hours of trading the index, which tracks Britain's biggest stocks, was off 74 points at 4996.3.
The fall continues the slide seen last week when the FTSE 100 lost more than 250 points in five days.
Justin Urquhart Stewart of 7 Investment Management says the figures are a continuation of last week with no confidence in the market.
He says this is a "Victor Meldrew" market where good news isn't believed.
He says the market is capable of dropping further until solid growth figures are released. Mr Urquhart Stewart says this may not happen until early 2002, although he believes a recovery is still possible this year.
He says the UK economy is in much better shape than the European or US economies, while consumer spending remains strong.
He adds: "People only really start getting concerned when they start seeing jobs being lost."
