FTSE down 48.5 points

Worries over growth prospects in the United States caused shares in London to go into reverse today.

The FTSE 100 Index sank 48.5 points to 5848.2 by mid-morning as the gloom from a poor session on Wall Street spilled across the Atlantic.

The Dow Jones Industrial Average lost 80 points after a survey of factory activity in Philadelphia suggested the US economy could be heading for a slowdown.

With little on the corporate calendar in London, second-tier stock MFI grabbed the headlines after it agreed to sell its loss-making retail arm for £1 so it could concentrate on its Howden Joinery business.

Problems at its 200 stores have weighed heavily on its share price recently and news that they were to be offloaded to Merchant Equity Partners caused MFI shares to jump 10% or 8.5p to 96p.

Back in the top flight, supermarket chain Morrisons lost some of the previous session’s gains as investors banked profits following a bullish set of results yesterday. Shares fell 6.5p to 245p today.

Only a handful of blue-chip stocks made it into positive territory, with a small risers board dominated by energy stocks on the back of a strengthening oil price. BP gained 3.5p to 582.5p while BG Group was ahead a penny at 640.5p.

Other notable moves in the FTSE 250 Index included a rise of more than 1% for Comet owner Kesa Electricals. The improvement of 4.75p to 332p came as investors prepared for the publication of interim results next week.

Carphone Warehouse shares lost 1% after it was reported that the mobile phone retailer planned to open a number of stores in North America, where it does not currently have a presence. The speculation received a cool reception with shares 3.25p lower at 302.75p.