FTSE down on U.S. growth fears
The top share index fell 1.4 percent early on Monday, tracking steep losses in the United States and Asia, as fears of U.S. recession and credit-related writedowns by financial institutions mounted.
FTSE up as energy stocks gainHSBC bucked the weakness, up 1.9 percent after the global banking group said its profits rose 10 percent last year, as strong gains in Asia helped it absorb a $17.2 billion hit for bad debts due to U.S. housing market problems.
"The (HSBC) headline number is a touch higher, and writedowns are basically in line. That's a bit of a relief," a trader said.
"There is also talk about partial decoupling in Asia, so that's probably helping a little bit."
At 8.40 a.m., the FTSE 100 was down 83.0 points at 5,801.3, led by banks and commodity shares. The UK benchmark index lost nearly 9 percent in the first two months of the year.
"The market has no confidence in global growth, particularly growth in the United States, and has great fears of the credit crisis," said David Buik of Cantor Index.
European shares also fell sharply in early trade.
Wall Street tumbled on Friday as another round of weak economic data added to U.S. recession fears and a record loss at insurer AIG underscored worries about more writedowns in the financial sector. In Asia, Japan's Nikkei average fell 4.5 percent on Monday as the dollar fell to a three-year low against the yen.
Banks were among the worst hit on the FTSE 100, shaving more than 13 points off the index.
Barclays, Royal Bank of Scotland, Lloyds TSB, HBOS, Alliance & Leicester and Standard Chartered were down between 1.6 and 4 percent.
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