The FTSE-100 index of leading British blue chips have spiralled to their lowest close in nearly three years as belief in the ravaged technology, media and telecoms sectors' ability to grow profits took yet another beating.
The benchmark closed 111.7 points or 2.1 percent down at 5,204.3 today, putting in its biggest single trading day fall since a 106-point slide in June and touching its lowest close since October 1998 after an intraday low of 5,189.8.
Investors took weak economic data as a trigger to dump unloved technology stocks, with telecoms equipment maker Marconi hounded another 23.7 per cent lower to 28.75p as worries about its debt levels bit deeper. Mobile giant Vodafone dropped 3.7 per cent on fresh pessimism about third generation mobile technology.
A Bank of England decision to leave interest rates unchanged sparked a short-lived flutter lower in the FTSE 100 but market watchers said the impact was swallowed by the overall mood of deep gloom.
Energis, Telewest and telecoms-testing equipment firm Spirent, prime candidates for dismissal from the FTSE 100 at next week's quarterly review, were down 12-16 per cent.
Banks came under fresh pressure, caught up in the general selling and losing some of their recent allure as a consolidation play. Barclays was down 4.7 per cent to 1,990p while Royal Bank of Scotland lost 2 per cent.
Traders said there were some jitters that the banks could get caught in the backwash if Marconi runs into trouble with its debt pile.