The City was left licking its wounds this evening after a severe mauling in response to record falls on the Hang Seng overnight. Hong Kong had seemed immune to the Tiger economy troubles which have afflicted many Far East markets, but concerns about the strength of the former colony's dollar proved too much to bear.
It shed nearly 1700 points at one stage but ended at its lowest levels for 15 months, 1088 points down on what the City is dubbing Red Thursday.
The FTSE reacted with a dive which almost hit 200 points, and sent the index crashing back under the 5000 mark.
It see-sawed during the morning, but by lunchtime was heading downwards again.
At its mid-afternoon nadir the index slumped 222.1 points, just 28 off the worst-ever one-day loss seen during the 1987 crash as it nervously awaited the opening of Wall Street, a heavy drop on which was feared would spark a freefall.
But when the Dow opened and started to slide, buyers moved in and the FTSE actually lifted its head and slowly clawed its way back towards the 5000 mark, closing 157.3 points down at 4991.5.
As would be expected the heaviest hits on the FTSE came against shares with Far East links and particularly those with close ties with Hong Kong.
HSBC has been the biggest casualty as the Hang Seng has fallen. Just two weeks ago its value was around the £22 mark, today it stood at £16.10, a fall of 156p.
Standard Chartered was also caught, losing 26 1/2p to 689 1/2p, Cable & Wireless on 473p was 17p lower and international car distributor Inchcape was down 38p at 244 1/2p.
But the gloom spread to the rest of the banking sector, with heavy falls at NatWest, down 20p to 950p, and Barclays down 47p to £15.50.
Abbey National was off sharply, down 39 1/2p to 929p, in spite of reporting an improvement in lending figures in its autumn business report. Abbey also announced that finance director Mr Ian Harley is to take over as chief executive when Mr Peter Birch retires next February.
Schroders dived by a pound to £18.25.
Given the state of the market, investors found it more difficult to find shares heading higher however by the end of trade there were several havens of blue on City screens.
RMC was 3p up on 910p, Allied Domecq was a penny better at 513p, Rolls-Royce added 2p to 227 1/2p, Thames Water was 1p ahead on 889p and Severn Trent came in 2p higher at 920p.
The only other gainers were outside the top 100.
Ferguson International added 21p to 138p after Prudential raised its stake and Hermes became a notifiable shareholder.
On the face of it, Ultraframe picked a decidedly dodgy day on which to start trading on the market, but in the end it moved off to a respectable premium, 17 1/2p higher than the 147p flotation price on 164 1/2p.
Minorco bid speculation lifted Hanson by 3p to 312p and expectations that TV channel EBN will be sold added 20p to 30 per cent stakeholder Flextech taking it to 571p.
Newcastle United's 1-0 Champions League defeat at the hands of PSV Eindhoven knocked 2p off its shares to 115p, while even Manchester United was 2 1/2p worse off on 666p despite beating Feyenoord 2-1.
Spurs were the other team in the spotlight with final results which showed an improved profit figure for the year but the costs of transfers wiped out any revenue gains. It was unchanged on 90p.
Chemicals giant ICI released better-than-expected third quarter earnings but this was simply not enough to counteract the general sentiment and the shares closed down 11 1/2p at 931p.
Major changes were: HSBC down 156p to £16.10, Barclays down 47p to £15.50, Ultraframe up 17 1/2p to 164 1/2p, Flextech up 20p to 571p, Ferguson International up 21p to 138p, Schroders down 100p to £18.25.
