A downgrade of Spanish banks fuelled eurozone debt fears today and capped the worst week for London’s leading shares index for nine months.
The FTSE 100 Index was 70.8 points lower at 5,267.6 after Moody’s Investor Service cut the credit ratings of 16 Spanish lenders, including the UK arm of Banco Santander.
The downgrade hit bank shares in the UK and came amid fears that the eurozone crisis will spread from Greece to Spain.
Yesterday’s fall was the fifth in a row for London’s blue chip shares index, meaning it has lost more than 300 points this week – slashing £79.8billion from the value of the UK’s top listed companies.
It is the biggest weekly points drop since August and the first time since November that the Footsie has fallen on five consecutive days.
The impact of Moody’s downgrade on Spanish banks left Barclays down 5.8p at 176.1p, Royal Bank of Scotland off 1.1p at 20p and Lloyds Banking Group 1.7p lower at 26p.
Heavily-weighted miners were also knocked by the uncertainty surrounding the eurozone as Xstrata fell 41.5p to 914.7p.
The biggest Footsie fallers also included luxury fashion firm Burberry, off 60p at £13.73.
Risers on the main market included Polymetal International up 22p at £7.99, Fresnillo ahead 28p at £13.58, CRH up 22p at £11.04 and Morrisons ahead 2.7p at 271.2p.
Outside the top flight, Mitchells and Butlers lost 6% of its value after it revealed a sharp slowdown in like-for-like sales. The shares dropped 15p to £2.31.
London Stock Exchange Group, which runs the LSE and Borsa Italiana markets, saw its shares lift 3%, or 27.5p to £9.92 after it revealed a 30% rise in annual profits to £442million.
Steven McKay, of investment manager and financial planning specialist Brewin Dolphin in Aberdeen, highlighted Xcite Energy adding 11% to 90.625p, Stagecoach Group up 1.2% to 235.85p and BG Group 1% higher at 1245.5p.
Cairn Energy fell 2.1% to 286.4p and BP lost 1.2% to finish the week at 391.95p.