The FTSE 100 fell 250 points today, wiping £60 billion from the value of the UK's 100 largest public companies. It was the biggest one-day percentage fall on the blue-chip index since April 2000 and the days of the dot-com boom.

At London's close, blue-chip stocks were also tumbling in America. Falls in equity values had been evident from the very start of the global trading day, when fresh fears of a global credit crunch dragged heavily on Asian markets.

On Wall Street the Dow Jones was down 184.4 points at London's close.

Later, in early afternoon trading on Wall Street, the Dow tumbled 308.41, or 2.40 per cent, to 12,553.06. The S&P shed 32.54, or 2.31 per cent, to 1,374.16, and the Nasdaq composite index dropped 66.27, or 2.70 per cent, to 2,392.56.

BACKGROUND

• Elephant slumps in wake of crunch

• Heads on the block, investors call for change

• Credit crunch forces Delek to leave property deal

• US rate cut looks certain after new data

• Bank of America to axe 3,000 after 'our errors'

BACKGROUND

• More pain for private equity industry

• Russian state bank poised to boost liquidity

• House prices‘to stay flat for years’

• Will soaring oil pump up inflation?

• US bank slump goes on

Black clouds loom on horizon

For the first time in 15 years, I am seriously worried about the outlook for the economy, the housing market and sterling

Float on the job market

Don't believe the scary headlines. It's not the worst time to consider a career in banking

Related Links

• Rating agencies head for EU showdown

• Bankers wait and hope for calm ahead

• Turmoil hits Asian equity markets

Credit jitters were emphasised by news that the US Federal Reserve injected $17 billion (£8.8 billion) today into the market in two separate operations.

The magnitude of the fall the FTSE 100, which took the index below the 6,000 level for the first time since October, is likely to raise fresh fears of a prolonged bear market - in which share prices continue to fall.

Since the FTSE 100 hit a peak of 6,700 on July 13, the value wiped from it now stands at about £200 billion.

In France, President Sarkozy confirmed that he had written to Angela Merkel, the German Chancellor and G7 chairwoman, suggesting that the G7 finance ministers work with their central banks and the IMF to work towards more transparent markets.

He said that the French and German economies would not experience a lasting impact of the present turmoil.

The fall in London follows a torrid day of plunging stock markets, and ultra-volatile currency movements persuaded trading floors across Asia that, after a decade of lucrative exploitation by hedge-funds, the so-called yen carry trade was now imploding.

The yen carry trade — the practice of cheaply borrowing yen to finance investments across the globe — is thought by some to be the core of the massive worldwide liquidity pool that is now contracting so violently.

The Nikkei 225 index of big Japanese stocks took a 327-point nosedive as nervous investors unloaded holdings of any company deemed likely to have either direct exposure to the American sub-prime debacle or the US economy in general.

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