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Market Nerves Strip £30bn From Top Stocks

27th January 2003

Nearly £30bn was wiped from the value of Britain's biggest companies as the FTSE 100 Index fell for an unprecedented eleventh session in a row.

Fears over a war with Iraq, terrorism and the health of the economy pushed the Footsie down a massive 122.9 points to 3480.8 in a day of turmoil in the City.

The index was last this low in September 1995 and at one point was just more than half its all-time high of 6950 - hit at the height of the tech-boom in December 1999.

And analysts warned the sell-off could continue despite the heavy falls already endured by such big names as Lloyds TSB, BP and mobile phone giant Vodafone.

Markets on Wall Street were falling yet again as Hans Blix gave details of the UN weapons inspectors' report on Iraq to the Security Council in New York.

And City nerves are likely to become yet more frayed ahead of President George W Bush's crucial State of the Union address.

This is almost certain to contain Washington's response to the weapons inspectors' report and heighten nerves about a possible conflict with Saddam Hussein.

Tom Hougaard, trader at City Index, said the FTSE could fall another 300 points. He added: "There is no real impetus to buy equities in the UK or Europe right now.

"If we get some kind of resolution on Iraq the market could easily gain 6% to 8% in a day. Otherwise it looks as if we will continue on downwards."

The jittery feel to the City was reflected by gold prices rocketing above the £225.62 an ounce level for the first time in six years.

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