Footsie continues to slide

Blue-chip shares shed another £29bn (€45bn) in value today as London’s FTSE 100 Index extended its losing streak into a third week.

The Footsie closed down 122.9 points at a new seven-year low of 3480.8 as investors remained on edge about the prospect of war in Iraq.

Today’s latest slump leaves the top-flight index just a fraction away from being half the value of its peak in December 1999.

The tone for the session was set early on with a 140 point drop – sparked by a sharp decline on Wall Street on Friday – before rallying in early afternoon.

But any hopes of avoiding an 11th straight day of losses fell at the same time as weapons inspectors made their report to the United Nations Security Council.

The report saying that Baghdad has not genuinely accepted a UN resolution demanding that it disarm did little for fragile investor confidence.

By the time of London’s close, the Dow Jones Industrial Average was 160 points lower while other European markets also closed sharply down.

The nervousness is likely to continue into tomorrow ahead of US President George W Bush’s State of the Union address.

In London, the Footsie was a sea of red with all the key heavyweight stocks falling sharply and just one stock – Renotkil Initial – finishing ahead.

Insurers – which face pressure to meet their all-important solvency ratios amid falling stock markets – fell the heaviest.

Royal & Sun Alliance led the Footsie fallers’ board – down 8%, or 8.75p to 99.5p – while Norwich Union owner Aviva was off 31.5p at 366.5p, Prudential slipped 28p at 360.5p and Friends Provident fell 7p to 87.25p.

Among the banks, Abbey National was down 23p at 400p – half its price in July - Barclays fell 12.75p to 339.25p, HSBC slid 13.5p at 644.5p and Lloyds TSB fell 22p to 378p.

Oil groups also weighed heavily, with BP off 3%, or 12.5p at 356.5p, while Shell was 11p lower at 349.5p.

And pharmaceuticals tumbled with GlaxoSmithKline down 49p at 1038p and AstraZeneca off 79p at 1820p.

In the telecoms sector, mobile phone giant Vodafone fell 3.75p to 111p and BT dropped 6.25p to 178p while mmO2 closed 0.5p lower at 49.25p after finding positive territory earlier in the session.

Outside the top flight, the mood was similar with just six FTSE 250 stocks posting gains. Heavy fallers included steel group Corus, down 3.5p at 23p and life insurer Britannic off 14p at 132.5p.

Cider maker HP Bulmer also paid the price for its warning on Friday that it may not have sufficient working capital for the next 12 months. Shares slumped 40.5p to 91p.

The only Footsie riser was Rentokil Initial up 3.5p at 187p.

The biggest fallers were Royal & Sun Alliance down 8.75p at 99.5p, Aviva off 31.5p at 366.5p, Amvescap down 27.5p at 329.5p, Capita Group off 15.5p at 190.75p and Friends Provident down 7p at 87.25p.