FTSE Moves: Top flight shares slump on US rate rise fears

The London market fell sharply amid fears of a US interest rate rise among traders.

The FTSE 100 index fell 107.7 points to 6,699.2, knocking more than £25bn ($33bn, €30bn) off blue-chip shares as the market reacted to comments from US Federal Reserve members on Friday.

Boston Fed President Eric Rosengren and Dallas Fed President Robert Kaplan both said late last week that the case for an interest rate rise has strengthened.

The Fed last raised rates in December to a range between 0.25% and 0.5%, but there has been mounting speculation about a further rate rise before the end of the year. Cheaper cash favours investors.

Spreadex financial analyst Connor Campbell said: "Without anything to distract them the markets are still looking pretty bloody, with investors continuing to wallow in their pre-Fed jitter."

In the London market, shares in Primark owner Associated British Foods (ABF) slumped as much as 11% after it warned the discount fashion chain was on course for its first ever like-for-like sales drop and the group's pensions scheme had swung to a £200m deficit.

ABF said the fashion chain had suffered under bad weather and is expected to post a 2% slide in annual like-for-like sales – the first time in 16 years Primark has posted a negative number.

In afternoon trading the biggest risers in the FTSE 100 Index were Morrisons (+1.8p to 194.3p), Paddy Power Betfair (+60p to 8,980p), Reckitt Benckiser (+18p to 7,199p), AstraZeneca (+8p to 4,827p) and Shire (+5p to 4,708p).

The biggest fallers in the FTSE 100 Index were Associated British Foods (-316p to 2,840p), Marks & Spencer Group (-18.7p to 325p), Anglo American (-39.5p to 807.1p), BHP Billiton (-47p to 970.5p) and Lloyds Banking Group (-2.5p to 56.8p).

In afternoon trading the biggest risers in the FTSE 250 Index were SVG Capital (+83p to 649.5p), IP Group (+6.5p to 188.5p), HarbourVest (+22p to 960p), Genus (+35p to 1875p) and JD Sports Fashion (+24p to 1,336p).

The biggest fallers in the FTSE 250 Index were Amec Foster Wheeler (-33p to 543p), Evraz (-6.8p to 132.7p), Centamin (-7p to 144.2p), Tullow Oil (-10.2p to 220.8p) and Renishaw (-116p to 2,618p).