FTSE 100 slumps 4.64% at close as US markets continue to fall

The FTSE 100 closed down 4.64 per cent today and US stock markets fell in morning trades following news of the US Federal Reserve’s economic stimulus.

The Dow Jones Industrial Index was down 3.34 per cent to 10,754 by 11.40am while the S&P 500 was down 3 per cent to 1,131.

The stimulus plan, called operation Twist, will see the Fed sell about £260bn worth of bonds maturing within three years and buy longer-term debt. The aim is to put money into the economy but keep interest rates low.