AIG and Lehman woes hit UK stocks

UK stocks finished down, as turmoil over the prospects of financials continued to impact on investors'' confidence.

The FTSE 100 slid by 153.58 points to finish down at 5,050.60, having earlier dropped to below 5,000 for the first time since 2005.

Confidence was impacted by the continuing aftershocks of Lehman Brothers announcing it was filing for bankruptcy, which hit financials hard for a second consecutive day.

Meanwhile, sentiment was further impaired by news that American International Group, the insurance giant, is seeking a lending facility of between $70 billion and $75 billion.

The falls came despite action from many of the world''s central banks to alleviate conditions in the wake of Lehman''s failure by pumping billions into the global financial system.

Speaking at a press conference in Cairo, IMF head Dominique Strauss-Kahn said: "What we see in Lehman Brothers is something that started months ago…so the consequences for the financial sector are not over and we are going to see more of that."