Fears that America’s sub-prime mortgage market crisis will spill over into the global economy took its toll of the FTSE, sending it plunging 92 points. Ben Bernanke’s comments to Congress about the state of the US housing market coupled with growing expectations that interest rates here will hit 6 per cent sent the blue-chip index to 6,567.1 at the close. It has so far lost 150 points this week.

Miners again led the fallers, as the weakening dollar – the pound reached a 26-year high yesterday at $2.053 – had its effect. Anglo American was down nearly 4 per cent or 124p at £31.00 and Lonmin fell 138p to £36.95, making a near 14 per cent fall since it gave warning on the quality of its platinum ore mine on Monday. BHP Billiton was down 42p at £14.44.

Tate & Lyle, the sugar producer, lost much of an earlier 5 per cent gain when, in its annual meeting statement, it trimmed its forecasts again for the current financial year, which ends next March. It came off 16½p to 583½p.

Worries that interest rate rises would hit consumer spending hurt fashion retailer Next, down 63p at £18.88, and Argos and Homebase owner Home Retail Group, off 11½p at 442¾p, while mortgage lender Northern Rock was down 19½p at 822½p.

Heineken, the Dutch brewer, helped to refresh the beer sector, saying its profits would be 25 per cent higher than last year compared with its earlier forecast of 13 per cent growth as demand grew from Eastern Europeans, Africans and South East Asians. SABMiller, which still has a heavy dependence on African drinkers and also brews in Central Europe, gained 21p to £13.10.

Meanwhile, Carlsberg’s chairman, Povl Krogsgaard-Larsen, told a Danish newspaper that he needed to find a chief executive by next month so that the company could take part in the consolidation of global brewers.

His oft-rumoured target Scottish & Newcastle put on 8.5p to 632p after Mr Krogsgaard-Larsen said it would be an “interesting partner for several reasons”, but analysts said a deal to buy S&N out of its Russian joint venture BBH was more likely.

Two water companies led the gainers, Kelda up 18½p at 889p and Severn Trent up 27p at £13.70. Both were helped by an upgrade from JPMorgan, which said fears about rising interest rates are overstated.

Pub operators were toasting the smoking ban after JD Wetherspoon – up 64p at 619p – said food sales had benefited, and Mitchells & Butlers was also up 16p at 892p on talk that it was about to seal a property deal with Robert Tchenguiz.

Enterprise Inns put on 4½p to 721p and Punch Taverns gained 7p to £13.07.

EMI lost 6¼p to 261¾p after Warner Music and Jim Fifield, a former EMI executive, both ruled out bidding for the company and EMI agreed to recommend an offer by Guy Hands’s private equity group Terra Firma. Mr Fifield said he would have offered a premium to Terra Firma’s 265p, but could not meet the Takeover Panel’s deadline set for tomorrow.

— New York: Stocks ended down, pressured by growing concerns about troubles in the sub-prime mortgage market and a warning from the Federal Reserve Chairman about housing weakness. The Dow Jones industrial average closed 53.30 points off at 13,918.20.

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