Dealers expecting a quiet day on London markets were caught unawares by the shock resignation of Barclays chief executive.

The news sent London's FTSE 100 index spiralling down 52 points to 5782 in the first half hour.

Barclays shares plummeted after the shock announcement that chief executive Martin Taylor was quitting.

More than 9% was wiped off the shares as they fell by 137p to £13.51.

The bank admitted it had not yet decided on a successor.

Barclays said it expected to report underlying profits of not less than £1.9 bn ($3.2 billion) for the year to December 31, 1998, compared with £1.716bn last year.

Acting chief executive and chairman-elect Sir Peter Middleton strongly denied the departure had anything to do with impending mergers.

But the banking sector took fright at the instability, dragging the FTSE down with it.

HSBC fell 49p to £16.55, NatWest was down 37p to £11.00, Lloyds TSB down 12½p to 845p and Halifax down 5p to 840p.

A profit warning at Euromoney Publications took the company down 87½p to £17.75 - a fall of nearly 5%.