Market Report: Footsie suffers as another bout of Asian flu strikes

Another bout of Asian flu hit shares. With Tokyo and Hong Kong lower and a left-wing president installed in South Korea, the stock market was soon in ragged retreat and lost further ground when New York compounded the unseasonable gloom.

By the close Footsie was nursing a 148.1 points fall at 5,020.2. It was the biggest closing slide for two months. At one time the index was down 182.6 points, below 5,000.

Tokyo was the early unsettling influence. It fell 5.2 per cent, to its lowest since the heady days of the 1980s. Hong Kong then took fright and, with New York decidedly under the weather, there was absolutely no chance London could ignore such despair.

Just to confuse the issue, the market also experienced its monthly witching hour when futures and options expire. On occasions it has been an eventful tug-of-war between the bears and the bulls. Yesterday it was all rather quiet but, nevertheless, in the fragile environment, it added to tension.

Most of the carnage occurred among blue chips. For once, supporting shares managed to stay out of the firing line. Indeed the FTSE SmallCap index turned in a relatively stable performance, falling 6.5 points to 2,295.1.

Blue chips' soggy display was achieved in fairly active trading; sellers were evident although order-driven trading may have exaggerated some falls towards the close.

Energy Group, reflecting Margaret Beckett's clearance of the pounds 5.9bn US takeover bid, was one of only nine blue chips to make headway - a modest 10p to 665p.

A few just-about-detectable ripples of excitement went through utilities, with ScottishPower up 7p to 526p and Anglian Water 15p higher at 835p. But Southern Electricity, the one regional electricity company to retain its independence, failed to light up on bid hopes; the shares fell 2p to 492p.

Indeed Thames Water was one of Footsie's major casualties, sinking 85p to 831p. Exporters were hard hit with TI, the engineer, crashing 56.5p to 439.5p and RMC, on its last day as a Footsie constituent, down 91p at 827p.

Financials also suffered with National Westminster Bank dropping 65p to 1,010p.

Societe Generale's takeover of Hambros banking operations left the shares down 2.5p at 256.5p.

Even on such a grey day progress was made. Racal Electronics put on 8p at 257p and Danka Business Systems continued its modest recovery after collapsing on a profits warning; up 6p to 239p.

The Monopolies and Mergers Commission report on the holiday industry held no worries for Airtours, the nation's second largest package tour operator, which rose 17.5p to 1,220p. First Choice, in third spot, climbed 2p to 99p.

Photo-Me International, the coin-operated photo booths chain, jumped 31p to 142.5p after enjoying a rare event - a profits uplift. The company increased its year's forecast from pounds 11.6m to between pounds 14m and pounds 14.5m.

Manders, an ink maker, soared 93.5p to 245p as US group Flint Ink moved in with an agreed 250p offer.

And TransTec, the engineer linked to under-pressure Paymaster General Geoffrey Robinson, added 10p to 77.5p as two directors acquired 40,000 shares at 70p and 77p. On Thursday the shares dipped to their lowest for three years.

American Port Services produced a profit warning, falling 24p to 124.5p, and Peterhead, a crane group, gave up 6p to 31.5p after saying earnings per share "will be substantially below market forecasts".

PizzaExpress, the fast food chain, held at 779p. Chief executive David Page has replaced entrepreneur Luke Johnson as chairman. Mr Johnson, who remains a director, is masterminding the launch of the Belgo mussels and chips restaurants on the market through Lonsdale Holdings (suspended at 4.75p). He sold 150,000 Pizza shares. Hugh Osmond, another Pizza director, unloaded 105,000 shares.

Scottish brewer Belhaven added 4.5p to 165p. Charterhouse Tilney and Panmure Gordon have lifted this year's profit forecast to pounds 4.8m, with pounds 5.5m pencilled in for next year.