A promising start to the week by London's equity market was wiped out by lunchtime yesterday as deteriorating bond markets across the globe removed one of the props for shares. Also hitting London were expectations of a poor start on Wall Street, which duly came about with the Dow Jones Industrial Average retreating well over 100 points shortly after opening. Dealers noted a return of uncertainty about interest rates across Europe, Britain and the US. The Bank of England's monetary policy committee meets on November 3rd and 4th with its decision to be made known at midday of the second day, while the European Central Bank's Governing Council also meets on the 4th to determine euro-zone rates.

By the finish of the trading day the FTSE 100 index had retreated from a mid-morning session high of 6,109.4, up 50.5, to close a net 49.5 lower at 6,009.4. At its worst, the index dropped back below the 6,000 level, touching 5,991.7. The overall mood of the market had also deteriorated as the curtain fell. The FTSE 250, which had managed to resist much of the downside pressure affecting the 100 index, retreated to settle only 7.6 firmer at 5,534.4. At its best, the 250 was up 27.4 at 5,554.1. The FTSE SmallCap index finished 6.8 up on the day at 2,620.9.

Initial gains in the market were a reflection of the latest burst of takeover action, which, although concentrated in the smaller companies, was seen as likely to be followed in the short term by deals involving FTSE 100 and 250 stocks.

Overall market turnover was 1.22 billion shares; Rolls-Royce, British Energy "A", and Vodafone accounted for almost a third of this activity.

The Dublin Market was closed yesterday for the October Bank Holiday.