Stocks put up a battling performance yesterday but could not resist the downward pressures imposed by the latest turmoil in far eastern markets and the hefty decline on Wall Street overnight.

And another bout of weakness in US stocks at the outset of trading yesterday drove London equities down sharply at the close.

Down 132 points on the Dow Jones Industrial Average overnight, the US market came in exceptionally weak and posted a 60 point fall as London closed, extending that loss to 130 points 90 minutes later.

The slide came in the wake of last week's jobless claims figure and the second-quarter current account deficit news, and were linked to a bout of weakness in US Treasury bonds.

The weakness in the leaders spread to other areas of the market, which, unlike the frontline stocks, have tended to attract funds in recent sessions.

Second-line issues were broadly lower, with the FT-SE Mid-250 index badly affected by profit warnings from two of its leading lights, Booker, the cash-and-carry business, and Coats Viyella, one of Britain's biggest textiles companies.

The day began badly for equities, with 3 per cent-plus falls in Kuala Lumpur, Hong Kong, Jakarta and Manila, plus a 2 per cent retreat on the Tokyo market, prompting an early markdown of London's leading stocks.

Thereafter the market was always under pressure, although marketmakers and dealers insisted that selling was never more than modest.

There were no surprises in the monetary policy committee's decision to leave interest rates on hold.

Among corporate news, BTR's restructuring plan and its stated intention of returning value to shareholders triggered strong support for the shares, which topped both the performance and activity tables.

Turnover was 717.9 million shares.