FTSE slides into the red as miners, financials plunge

Miners and financial shares led the sell-off as economic confidence suffered in the wake of the latest bad news from Greece.

The FTSE 100 Index dropped 58.10 points to 5665.33 while the Dow Jones Industrial Average fell nearly 1 per cent in New York.

Indices also dropped across Europe, with the Cac 40 in France among the worst impacted, down 1.2 per cent.

European statistics agency Eurostat reported that Greece's budget deficit in 2009 was 13.6 per cent of gross domestic product, instead of the previously predicted 12.9 per cent, while the ratio of government debt to GDP stood at 115.1 per cent, the second highest in the EU after Italy.

The agency also expressed "a reservation on the quality of the data reported by Greece", and warned the 2009 figures could be revised further.

Further fears over Greece saw the euro take another hit, with the pound up to levels not seen since February against the single currency, at 1.16 euros.

But sterling eased back marginally against the US dollar, to 1.54 dollars.

The number of US workers filing new claims for jobless aid fell last week as the labour market gradually heals and producer price data showed inflation remained muted, despite a surge in food costs last month.

In other US data, sales of previously owned home rose 6.8 per cent to an annual rate of 5.35 million units in March as Americans rushed to take advantage of a tax credit for home buyers, the National Association of Realtors said.

Analysts said the data pointed to a moderate economic recovery.

News from the corporate results season also weighed sentiment on the Footsie, even though Nokia's first-quarter net profit surged on the back of smart phone sales and 3 per cent growth in total revenues.

Nokia's share price plunged 14 per cent in Helsinki as traders had expected a better performance and a more upbeat forecast.

Indications of weak crude demand in the US also sent oil prices lower to around 83 dollars a barrel.

In London, oil and commodities firms littered the fallers' board, while financial firms also suffered due to economic fears, with Prudential down 19p to 5451/2p and Aviva 113/4p lower at 374p.

British Airways was also down 8p to 2251/2p as airline losses remain in the spotlight following the closure of European airspace as a result of the Icelandic volcanic eruption.

The sell-off wrecked earlier gains in the FTSE 250 Index, with gaming firm Rank up by a marginal 11/8p to close at 119p after initially rising by more than 5 per cent in the wake of a well-received trading update.

Rank had been lifted by the success of its new-look Grosvenor Casino business, while its Mecca bingo arm also posted a resilient performance.

Persimmon was 141/4p higher at 480p after its trading statement showed sales volumes have remained consistent despite the backdrop of continued election uncertainty. Rival firm Taylor Wimpey benefited, adding a penny to 401/8p.

Sports World retailer Sports Direct International declined 2 per cent despite posting sales growth of nearly 3 per cent and said it remained on course to meet its recently improved full-year earnings target. Shares were 2p lower at 106p.

The four biggest risers were Arm Holdings ahead 83/8p to 2587/8p, Autonomy up 52p to 1834p, Intercontinental Hotels ahead 21p to 1075p and Intertek which was 29p higher at 1534p.