B&B nationalisation rocks UK stocks

By MoneyhighStreet Staff. Published on September 29, 2008 This post currently has no comments.

Bradford Bingley
UK stocks plunged below the 5,000 points barrier today as the nationalisation of Bradford and Bingley (B&B) hit investor confidence in the financial services sector.

The FTSE 100 shed 232.91 points to close down at 4,855.56, while the broader FTSE 250 lost 436.31 points to 7,838.13.

The retreat followed a fraught day of trading and marks the second time in two sessions in which the FTSE 100 has finished beneath the 5,000 mark.

Financials had lead the losses, with Royal Bank of Scotland, Barclays, HBOS and its new owner Lloyds TSB all suffering from impaired confidence among investors.

Meanwhile, other financials were impacted by ongoing uncertainty over the US government''s "$700 billion economic rescue plan, which has been delayed by debate over its provisions in Congress.

Tim Rees, director of UK equities at Insight Asset Management, told the Reuters news agency: "There was enthusiasm last week about the [rescue package] but investors have had time to reflect and realise that there is no quick fix, and that while this may be a step in the right direction, it doesn''t change the fundamentals."