FTSE drops sharply on investor “woe and fear”

The FTSE 100 dropped by over three per cent this morning, with investor sentiment continuing to be knocked by negative economic news.

HBOS announced today that it would be writing down around £5 billion in personal loans and business loans.

Meanwhile, the US Senate voted down a £10 billion bailout package for carmakers GM and Chrysler.

The pound also fell to an all-time low against the euro yesterday.

In the Senate, the vote against a financial bailout package for large car manufacturers has led to the FTSE 100 retreating sharply this morning.

Speaking to the Daily Telegraph, David Buik at BGC Partners commented: "It''s a bad day because of uncertainty and uncertainty is the most toxic experience you can have. I think we are going to see a general markdown.

"I''m full of woe and fear because there''s no real good news."

As of 10:02 GMT, the FTSE 100 was down 3.1 percent to 4252.67 points.