Uncertainty over whether US political rivals will agree a crucial spending and taxation deal drove a volatile run on the London market today.

British Airways tonight signed a new deal with its caterers at Heathrow Airport, finally bringing to an end a row which led to huge travel disruption in the summer.

GATE GOURMET, the caterer at the centre of a two-day strike that grounded 700 British Airways flights, said it offered sacked and current employees compensation as part of a plan to reduce its workforce.