There was no respite for London's equity market yesterday, with sellers again out in force, driving all the main indices lower for the fourth consecutive day and the sixth out of the last seven trading sessions.
Once again it was the threat of a rise in UK interest rates, possibly as early as next month, that hung over the market, although there was a minor element of relief for the big exporting stocks as sterling nudged down against the dollar and the D-Mark. The Bank of England's exchange rate index moved higher early in the session, only to turn off in mid-morning and finish down on the day.
By then, however, the damage to stock market sentiment had already been done. The expiry of FTSE 100 index options in midmorning prompted a substantial flurry of activity during a 20minute period and brought renewed downside pressure on an already nervous market.
The FTSE 100 index dropped decisively below 6,000, sliding another 79.8, or 1.3 per cent, to 5,922.2, extending the decline over the shortened week to 183.3, or 3 per cent.
More worrying, dealers said, was the extent of the weakness which encompassed the second-liners and the smallcap stocks.
The FTSE 250 index fell 17.6 to 5,519.2, leaving that measure 10.1 lower over the week, while the FTSE SmallCap index dipped 6.6 to 2,623.7 a decline of 10.6 over the four-day period. The FTSE All-Share index fell 30.5 or 1.1 per cent.
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