FTSE continues plunge

The FTSE 100 Index has continued to plunge deeper into negative territory, closing down more than 100 points for the second day in a row.

London's benchmark share index dropped nearly 2% as it shed 114.6 points to close at 6171.5 despite positive investor sentiment in the United States, with the Dow Jones Industrial Average trading up as investors took weaker than expected economic data in their stride.

An early pull back on Tuesday's dramatic losses, which saw £36.2bn (€53.7bn) wiped off the value of London shares, was reversed towards the end of the day, leaving just a handful of company shares in the black.

Disappointing news from a number of corporates added to the market woes from Tuesday, which were largely driven by speculation that China was to introduce measures to curb its booming economy and fears expressed by former Federal Reserve chairman Alan Greenspan that the US may be on the verge of recession.

HBOS was top of the Footsie fallers' board, after its cautionary outlook for 2007 and warnings its lending margins may decline this year took the shine off otherwise impressive results for 2006, which saw the high street banking giant post better than expected pre-tax profits of £5.71bn (€8.46bn). HBOS shares were down 52p at 1081p, a drop of 5%.

A number of other banks were also lower with Barclays down 28p at 740p, Royal Bank of Scotland off 57p at 2009p and Lloyds TSB down 11p at 574p.

Asia-facing bank Standard Chartered also suffered, down 22p to 1428p after it revealed yesterday that impairment losses on loans and other credit risk provisions almost doubled in 2006.

Camera retailer Jessops was one of the biggest losers of the day after issuing a profits warning signalling that profits may come in 61% lower than market expectations, forecast at just £6.5m (€9.63m) for the year to the end of September, and confirming it was re-negotiating financing with its bankers.

Jessops shares plummeted by 30%, or 31.75p, to 74.75p. Miners also continued to sustain heavy losses with Xstrata off 84p at 2395p and Kazakhmys down 35p at 1101p.

On the risers board, the defensive appeal of catalysts and precious metals firm Johnson Matthey during a time of market volatility meant its share price rose 5p at 1542p.

Leisure group Whitbread was among other risers after posting a trading update at the top end of expectations. It said business had strengthened throughout the year and pointed to hopes for a strong set of annual results.

The stock was 17p higher at 1648p, a gain of 1%. Argos owner Home Retail Group was another of the few blue-chip stocks in positive territory with a gain of 3p, or 1%, to 423p amid continued rumours of a possible takeover bid from private equity group Apax.

But Capita - the group that manages London's congestion charge system, led the risers with a share gain of 11.5p at 547p after Deutsche Bank upped its rating of the group from hold to buy, saying the group was "as close to bullet proof from global economic developments as it gets".

The biggest Footsie risers were Capita up 11.5p at 647p, Whitbread ahead 17p at 1648p, Reuters up 3.75p at 435.75p and Home Retail Group up 3p at 423p.

The biggest Footsie fallers were HBOS down 52p at 1081p, Cable & Wireless off 6.75p at 164.75p, Barclays down 28p at 740p and Anglo American off 91p at 2416p.