Shares hit by record fall

Almost £50 billion was wiped off the value of shares today as the FTSE 100 index crashed to its lowest level for six years - tumbling 208.4 points to 3698.8.

Dealers were stunned after an early savaging in trading was repeated with renewed frenzy once Wall Street began trading much lower than expected. The crashing share prices spelt further gloom for investors, who have watched the value of portfolios and pension funds tumble in recent days.

Today's 5.5 per cent fall in the FTSE 100 is the sixth worst in history in percentage terms, ranking only behind the falls on 11 September last year and the Black Monday crash and subsequent days of October 1987.

The Dow Jones Industrial Average, America's measure of leading shares, fell by 208.28 points, or nearly three per cent of its value, to its lowest for five years. All 17 stock markets across Europe showed falls with Germany down 4.2 per cent and France off 5.5 per cent. US stock markets have lost 13 per cent of their value this month.

Global markets remain worried about the situation in Iraq, and were spooked by an unexpected sales warning from mobile phone maker Ericsson and signs of a slowing US economy.