The UK market's winning streak ran out yesterday as weak economic data prompted renewed concern about the outlook for corporate profits.

The FTSE 100 index, which had climbed more than 300 points over the previous six sessions, fell 36.9 points to 5,547.6, although that still left the blue-chip benchmark 2.7 per cent higher on the week.

The purchasing managers' survey of the services sector gave a hint as to why the Bank of England's monetary policy committee decided to cut interest rates on Thursday. The index dropped to 50.3, indicating that the sector, which makes up the bulk of the economy, is barely growing; meanwhile, the manufacturing sector is in decline.

There was also some bad news from the US. The monthly employment data did not appear to pose any great problems for the market, with non-farm payrolls falling 42,000, slightly less than expected and the unemployment rate staying at 4.5 per cent.

But the employment numbers were followed by the purchasing managers' survey of the services sector, which showed a surprise fall below 50, indicating declining activity. The Dow Jones Industrial Average fell more than 100 points in early trading, while the Footsie was dragged down to its low for the day of 5,511.1 in the mid-afternoon. Telecommunications, media and technology stocks fell back after their recent rally with TMT groups accounting for seven of the nine worst performers in the FTSE 100. Oil giant Shell was weak once again, after announcing weak production numbers on Thursday.

The Techmark 100 index of leading technology stocks fell 18.33 to 1,604.78, but the index was still 5.6 per cent ahead on the week.

The other indices also had good weeks. The FTSE 250 fell 2.4 to 6,198.7, leaving it 3.8 per cent ahead over the five sessions while the SmallCap rose 4.1 to 2,776.7 for a 2.1 per cent weekly gain.

United Business & Media said market conditions were challenging while there were profit warnings from TBI, the airport group, and Landround, the travel promotions company.

Although economic news continues to be weak, the markets have rallied over the last few sessions on the belief that the bad news may now be reflected in share prices. In late July, the FTSE 100 briefly reached its lowest level since October 1998.

After the flurry of activity occasioned by Thursday's rate cut news, turnover subsided to more normal summer levels with 1.64 billion shares traded by the 6 p.m. count.