Global spats drive Footsie back into red

The FTSE 100 fell to a six-month low as sustained political jitters and global trade spats sent global equities into the red.

London’s blue chip index ended the day down 91.85 points at 7,145.74, with European and US equities suffering a similar fate.

David Madden, market analyst at CMC Markets UK, said: “Continued concerns about the political situation in Italy, and the relatively high yields on US government bonds, and the strained global trading relations have all contributed to the decline in European stocks.”

Markets were nervous as Italy signalled it will stick to plans to raise the budget deficit to 2.4 per cent, indicating a collision course with Brussels.

Investors also worried about the heated trade spat between the US and China.

But the rising pound contributed to weighing down the FTSE 100, trading at its highest levels against the euro since June, up 0.1 per cent at €1.144. Versus the US dollar, sterling shot up 0.5 per cent to trade at $1.320.

It came as UK growth data released by the Office for National Statistics showed gross domestic product rising at a healthy clip of 0.7 per cent in the three months to August.

In UK stocks, bar operator Revolution announced it had terminated acquisition discussions with nightclub owner Deltic, saying it will instead focus on “delivering the positively received strategy” the group had outlined in its preliminary results last week. Shares closes down 0.9p at 127p.

Easyjet shares fell 14p to 1,197.5p after its CEO warned rising fuel costs could lead to more carriers following Primera Air into collapse.