The first trading session of the millennium on the London stock market brought a flurry of selling pressure, described by some traders as sizeable, but by others as nothing more than short-term profit-taking.
The FTSE 100 index posted its biggest-ever points fall in a single session, closing 264.3, or 3.8 per cent, lower at 6,665.9. The previous biggest single-day points fall in the index was on October 20th, 1987, during that year's crash. But yesterday's retreat was only the eighth worst in percentage terms.
Behind the sudden and generally unexpected slide in the market leaders was a growing fear that the new millennium will bring more interest rate rises in Europe and the US.
Those worries first manifested themselves in the US on Monday, when the Dow Jones Industrial Average dropped 139 points. The downward move was followed yesterday by a further steep decline.
The steep falls in the FTSE 100 constituents were not mirrored by the junior FTSE indices, however. The FTSE 250 spent much of the day in positive territory, only to slip away late in the session and finish 12.8 lower at 6,432. And the FTSE SmallCap finished at a record close of 3,098.4, up 0.6, having hit an intra-day peak of 3,110.8 in mid-morning.
