Banks Drive FTSE Lower

London equities fell on Tuesday, with banking stocks at the forefront of the selling as the FTSE 100’s six-session rally faded.

The benchmark index lost 1 per cent to 5,952.6, a fall of 62 points, with banking stocks accounting for much of the decline.

Wall Street stock markets failed to lend support, with the Dow Jones Industrial Average opening 0.5 per cent lower at 12,544.4 after Washington Mutual said it would receive $7bn capital infusion from a group of investors.

News of a bigger-than-expected 2.5 per cent monthly decline in the Halifax house price index also damped sentiment toward mortgage lenders. It was the biggest month-on-month decline since 1992 and came as banks have tightened lending criteria.

Banks Drive FTSE Lower, Financial Times
4/8/2008 7:54:21 AM