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London Shares Dive at Open on Fed News

London Shares Dive at Open on Fed News

London shares fell sharply in opening deals on Thursday, in line with a global retreat after the US Federal Reserve signalled it would wind down its massive quantitative easing stimulus programme later this year.

In initial trading, the benchmark FTSE 100 index slid 1.5 percent to 6,253.28 points.

Elsewhere, Frankfurt’s DAX 30 dived 1.69 percent to 8,057.64 points and in Paris the CAC 40 shed 1.62 percent to 3,777.06.

Asian markets also fell sharply on Thursday, following heavy losses on Wall Street in the wake of the Fed news, and after weak Chinese manufacturing data.

The Federal Reserve said on Wednesday that it would keep in place its $85-billion-a-month bond-buying programme as unemployment remains high and growth in the world’s top economy was being held back by government spending cuts.

However, in a news conference, Fed chairman Ben Bernanke said that the central bank’s policy committee “currently anticipates that it would be appropriate to moderate the monthly pace of purchases later this year” if the economic outlook continued to improve.

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