FTSE down on weak US data

By MoneyhighStreet Staff. Published on October 2, 2008 This post currently has no comments.

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UK blue chip stocks closed down today, after weak economic data from the US stoked fears of a full-blown recession

The FTSE 100 shed 89.3 points to close down at 4,870.3, while the broader FTSE All-Share lost 37.04 to 2,473.24.

Uncertainty over the future of the government''s $700 billion bail-out plan was a key weight on investor sentiment, with a key vote to be held tomorrow in the House of Representatives.

The lower house rejected the bill earlier in the week after doubts were raised as to the efficacy of the plan.

Meanwhile confidence was impacted further by data showing that new orders at factories in the US fell by four per cent during August.

Tim Whitehead, head of portfolio services at Redmayne-Bentley, told the Reuters news agency: "It may be any immediate euphoria following the bailout will be very short lived.

"If liquidity did not resume in the credit market, the fear could be this was America''s last major attempt to do something about the crisis and then where do we go from here?"