A wave of selling triggered by American retail sales figures that were worse than expected turned trading screens red on both sides of the Atlantic and left the FTSE 100 down 190 points at 6,025.6. Investors were also stampeding out of British banks after Citigroup revealed massive losses on sub-prime exposure and slashed its dividend.

Royal Bank of Scotland was one of the hardest-hit, falling 24½p to 392p to a seven-year low amid mounting fears of a rights issue after its acquisition of ABN Amro. Alliance & Leicester fell 36p to 717p and HSBC, exposed to the American mortgage market through the former Household, closed down 38½p at 772½p.

Taylor Wimpey’s gloomy trading statement made the housebuilder the biggest blue-chip victim, down 13.3p to a five-year low of 159.2p - a 70 per cent fall since the merger of George Wimpey with Taylor Woodrow last spring.

Fears over consumer spending were heightened by Tesco, down 13p at 407p, missing its sales growth forecasts; a gloomy outlook statement from Debenhams, which lost 12¾p to a new low of 63¾p; and slowing sales for Burberry, off 80p at 406½p.

Home Retail Group, the owner of Argos and Homebase, slipped 19¼p to 261¾p before its trading statement tomorrow, while Kingfisher, the B&Q owner, lost 8.9p to 122.2p. JPMorgan said that Kingfisher would have to cut spending, trim dividends and sell property in France or Italy to restore its balance sheet.

J Sainsbury was one of only six blue chips in the black, rising 6¾p to 386p, helped by Goldman Sachs upgrading to “buy”. It said that the supermarket’s value was lower than that of its properties and that its Qatari suitors may come back with another bid in May.

Experian Group, the credit-checker battered by the credit crunch in the United States, was the top performer, rising 9p to 475p, ahead of a trading statement today and after Equifax, an American rival, said that its earnings for the year would be in line with its targets. Carphone Warehouse, down 19½p to 293p, was again hit by the general retail sell-off, ahead of trading figures this Friday. Sector-watchers believe that it will have been resilient to the slowdown on the high street.

Goldman Sachs wiped 40p off First Group, the bus and coach operator, to 634½p. It said that its Greyhound coach unit in America was vulnerable to a recession and cut its target to 600p.

Enterprise Inns closed down 25¼p at 392p amid talk that it may reveal poor trading figures at its annual meeting tomorrow, but Restaurant Groupwas buoyed 13p to 136p on talk of a bid after offers for Regent Inns.

British Land fell 62½p to 882p after Société Générale advised clients to “sell” with a 780p target. It owns the Meadowhall shopping centre in Sheffield, not Hammerson, as we stated yesterday.

Imperial Energy, the Russian oil explorer, fell 179p to £16.35 after Peter Levine, its founding chairman, sold a 3 per cent stake for £25 million.

New York: Stocks fell sharply after Citigroup revealed its $9.8 billion fourth-quarter loss and confidence in the consumer sector was eroded by a decline in retail sales. At the close the Dow Jones industrial average was down 277.00 points at 12,501.10.

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