FTSE slides after interest rate cut

The London market has plunged back into negative territory,after suffering a delayed reaction to the Bank of England's decision to slash interest rates.

After the briefest of rallies, share prices slid lower with the FTSE 100 Index closing at 3597.0, down 81.7 points.

Investors were wrongfooted by the quarter-point reduction to 3.75%, the lowest rate since 1955. Most economists had forecast rates would be unchanged.

Simon Buckingham, head of UK dealing at stockbroker Gerrard, said: "The market has not reacted very well to the Bank of England rate cut.