The FTSE 100 ended Friday 81.5 points, or 1.2 per cent, down, at 6,527.9 on the twentieth anniversary of Black Monday. All but a handful of stocks ended the day’s trading in the red, but experts said that, with a number of big companies reporting next week, there was a possibility that strong news would help to recover the losses. Martin Slaney, the head of spread betting at GTF Global Markets, said: “The anniversary of Black Monday has proved an uncomfortable reminder and it’s culminated in a classic end-of-week profit-taking scenario.”

Banking stocks suffered from the knock-on effects of Bank of America’s disappointing results. On Thursday the US bank reported a worse than expected plunge in third-quarter profits. Yesterday Royal Bank of Scotland’s 13p fall to 510½p was exacerbated by a downgrade from Dresdner Kleinwort. Barclays fell 13p to 589½p on continuing credit concerns, HBOS dropped 25p to 835p and HSBC slid 19½p to 923½p. Concerns over the mortgage market continued to trouble Alliance & Leicester, which lost 21p to 735p.

AstraZeneca was one of the FTSE 100’s biggest fallers, losing 93p to £26.41, after the European Patent Office revoked a patent on the company’s key asthma drug, Symbicort. UBS downgraded the stock to “sell” from “neutral”.

Tullow Oil finished down 15½p at 621½p despite a “buy” recommendation from Evolution Securities, which said that the oil company had barely begun exploring the potential of its Ugandan site.

Speculation on a 500p per share bid for Redrow, the £594 million housebuilder, helped the recovery of builders and property developers, which had been punished on Thursday for new figures revealing September’s decline in mortgage sales. Persimmon, the housebuilder, rose 11p to 971p and Barratt Developments gained 8½p to 667p. Redrow itself climbed 11¼p to 383p on the strength of the rumour, which made it one of the FTSE 250’s strongest risers.

Merrill Lynch yesterday reiterated the investment potential of the sector. Wolseley, however, continued Thursday’s fall after Credit Suisse cut the builder’s merchant from “neutral” to “underperform” and reduced its target price from 850p to 720p. Credit Suisse cited concerns over the US property market. Wolseley fell 4p to 782½p.

Bid fever supported the prices of Resolution and Scottish & Newcastle. Pearl Group yesterday tabled an offer worth 700.17p per share for Resolution, a closed life fund consolidator. A competing bid, possibly from Standard Life, is expected to emerge in the next few days, pushing Resolution’s shares up 15p to 722p. Standard Life closed up 1p to 285p. The likelihood of a rival offer for Scottish & Newcastle, or the emergence of a white knight that will save Britain’s biggest brewer from an unwanted £7 billion break-up bid by Heineken and Carlsberg, helped its shares to rise 9½p to 767p.

New York: The Dow Jones industrial average finished the day down 367 points, or 2.6 per cent, to 13,522.00 as renewed credit concerns, lacklustre corporate earnings and rising oil prices spooked investors. The market turned sharply lower in late afternoon when Standard and Poor’s again reduced its ratings on residential mortgage-backed securities.

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