Footsie continues its downward slide

London's stock market spent most of yesterday's session unsure of which way to jump, but eventually fell away heavily as the curtain came down on the trading session, finishing sharply lower on balance and recording its third successive decline. The market's closing weakness came as dealers continued to fret about the possibility of a rise in US interest rates after the meeting next week of the US Federal Reserve's open market committee.

But those putting forward the bull case for British stocks, pointed to the possibility of another cut in domestic interest rates, which they insisted would underpin the London market. And the constant stream of takeover bids and merger in Britain continued apace yesterday, with bid action right across the board.

London could not resist the downside pressures and the FTSE 100 eventually dipped away, finishing a net 79.8 lower at 6,416.7, having threatened to drop through the 6,400 level as Wall Street's weakness became increasingly worrying for London traders.

Dealers said the takeover stories had prevented a more severe sell-off of the market. The biggest of the bids was the near £1 billion sterling (€1.5 billion) offer for Newquest from the US. Turnover in equities was 1.27 billion shares with non-FTSE 100 stocks accounting for a lowly 48 per cent of overall turnover.