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Monday, October 5, 1998 Published at 08:39 GMT 09:39 UK

Business: The Markets

London market report

[ image:  ]
Monday close

London share prices crashed in late trading as fears of a global recession gripped the market and Wall Street shares plunged when the US stock market opened.

The FTSE 100 index of leading shares ended the day down more than 2%, or 101.7 points at 4648.7.

The index is now at its lowest close since June 30 1997.

A sharp fall in US shares in early trading on Wall Street caused stocks to tumble in London.

Disappointment over the lack of concrete action at the weekend by financial officials of the G7 group of leading industrial nations knocked investors' confidence in the markets.

Growing concerns that Japan's banking problems are worse than first thought also contributed to the market malaise.

Even the prospect of a cut in UK interest rates on Thursday failed to stem the decline in stock prices.

"International factors have again set the tone. I'm not even sure a UK interest rate cut will be enough to prop up the equity market at the moment," said one UK dealer.

Treasury bond yields fell to a record low, as the flight to safety continued.

IT stocks fell sharply, mirroring a fall on the US Nasdaq index of hi-technology stocks.

Sema fell 8.3% and Logica 9.4%.

Menswear retailers Moss Bros Group posted a slight fall in profits, but insisted the business was in good health. Despite this it slipped 21p to 122.5p.

There was good news from restaurant company Groupe Chez Gerard which saw its full year profits grow by a fifth after record sales growth.

However it slipped 23.5p to 179p.

Computacenter unveiled an alliance with giant Microsoft which will create 900 jobs in the UK plus 100 on the continent - but Computacenter's shares fell along with other IT stocks by 22.5p to 442.5p.

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