FTSE plummets despite bank bail-out
- 00:01:56
- ITN
FTSE plummets despite bank bail-out
The FTSE 100 has plummeted despite the Government's £50 billion bank bail-out plan. By 10.05am the index was down 193.2 points, almost 4 per cent, at 4413.1, having shed 7 per cent at one stage, tumbling to 4245.3. CMC Markets dealer Matt Buckland did not expect the UK banking rescue plan to buck the market gloom, saying: "For the time being, it looks as if the impact is going to be minimal. "As we've seen in the US, government intervention isn't freeing up credit markets and that is the key point - if it's difficult for companies and individuals to get hold of credit, it's going to be difficult to stimulate growth and break out of this recessionary mindset." Eight UK banks and building societies - including HBOS, RBS, Barclays, Lloyds TSB and Nationwide - have signed up to an initial £25 billion scheme. And the Government said it is ready to make at least another £25 billion available for other eligible institutions. The Bank of England is also extending the existing £50 billion Special Liquidity Scheme to £200 billion, while a further £250 billion being pumped in under a debt guarantee scheme. Prime Minister Gordon Brown said: "All these are investments being made by the Government which will earn a proper return for the taxpayer." Banking stocks pared early gains, with Barclays 10.9p lower at 274.1p, Lloyds TSB at 223.8p, down 2.8p, RBS down 0.5p at 97p but HBOS bucked the trend and climbed 33p to 127p. The City had been braced for fresh turbulence after Asian stocks were battered overnight. Japan's Nikkei index slid nearly 10 per cent at one point - its biggest drop since the 1987 stock market crash - amid fears that the spreading financial crisis could bring a global recession. In New York, the Dow Jones Industrial Average lost more than 500 points, or 5 per cent, on Tuesday to close at 9447.1.
ITN | October 8, 2008
