FTSE down 1.6% amid fears of downgrade for French banks

French banking stocks drove another sell-off on world markets today amid renewed fears that Greece would default on its debts.

Rumours of a credit rating downgrade for French banks intensified the sense of panic about the eurozone debt crisis. Shares in Societe Generale slumped 11%, even though it said its exposure to the eurozone's troubled economies was diminishing.