Rate worries, corporate news drag Footsie down

A wave of anxiety swept through the London market as US economic data again reawakened interest rate fears and sentiment was …

A wave of anxiety swept through the London market as US economic data again reawakened interest rate fears and sentiment was hit by disappointing corporate news. The US employment cost index rose a seasonally adjusted 1.1 per cent in the second quarter against analysts' expectations of a 0.8 per cent advance. The figures again raised the prospect of an increase in US interest rates. The FTSE 100 index tumbled following the release of the stronger-than-expected US data. However, yesterday's decline only exacerbated an already established trend after poor corporate news from two of the market's biggest constituents. Heavyweight pharmaceutical Glaxo Wellcome stunned the market by warning it would not meet its target of double-digit sales and earnings growth this year and the shares tumbled.