Yell Group fell to a new low after UBS cut tis target price to 150p from 265p warning that economic pressures would force advertisers to defect from directories and "we think once this spend disappears, there is potential that it might not return even if the economic concerns subside. We see this as a risk for both the UK and the US businesses."

Yell lost 5.75p to 194.5p. Kaupthing turned up the pressure on the directory group by contrasting with Johnston Press and Informa which both have provided information about covenants - the ratio of debt to earnings at which banks can call in their loan - but Yell had not making it difficult to assess the threats. It said it doubted Informa and Johnston Press would breach covenants this year.

UBS's Ian Whittaker also cut his target on Johnston Press for similar reasons, from 225p to 165p and the regional newspaper group lost another 4.5 per cent to 162p following its 8 per cent fall yesterday. He warned that it was close to its covenant level and could breach it if advertising demand fell further than the minus five per cent forecast, although the company says it can axe £15 million of capital expenditure if necessary.

The FTSE 100 lost 56 points to 5710.2 by 10.20am as fears of a US recession abounded ahead of employment figures from the US later today.

Miners, the usual prop of the index, were on the slide on profit taking from recent gains with Vedanta Resources leading the fallers, down 4.4 per cent at £22.63 and BHP Billiton close behind down 4.3 per cent at £16.09.

JD Wetherspoon hurt pub groups with a cautious outlook statement, warning of "significant future cost pressures" of rising energy and raw material costs. It lost 10 per cent to 281.5p and blue chip rival Enterprise Inns fell 3 per cent to 400.5p.

Cazenove had a good look at the house building sector and advised investors that Redrow and Taylor Wimpey shares were pricing in a UK housing recession and "must offer attractions to income and value investors." But the others, it said were too expensive and did not reflect the underlying downturn in the housing market. Taylor Wimpey was the top performer in the blue chips, up 1.6 per cent at 170.5p.

Marks & Spencer lost another 2.8 per cent to 379p as it said it would hand over £400 million worth of its properties into its pension fund and up its annual contritbution from £50 million to £72 million for the next 14 years to help prop it up.

The retailer was already under pressure following earlier than expected sales and soaring sales from rival Waitrose revealed yesterday.

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