What was expected to be a quiet start to the week in London was suddenly transformed in the early afternoon by news that a US aircraft had crashed in the borough of Queens in New York after taking off from JFK airport.

That news, instantly reviving the horrors of the attacks on New York and Washington on September 11th, and coinciding with the opening of US markets, saw Wall Street stocks plunge. The Dow Jones Industrial Average fell almost 200 points shortly after US markets opened and markets across the globe fell in tandem.

London was no exception, with the FTSE 100, having spent all morning jousting with 5,200, the upper level of the tight 5,000-5,200 range that has mostly gripped the 100 index since the start of October, suddenly plunging from just above the 5,200 mark to a day's low of 5,065.3 - down 178.9 within a matter of minutes.

A measure of calm returned to the market soon afterwards, as doubts were cast on the chances of the crash being caused by terrorists and as Wall Street staged a tentative rally.

But the damage to the market's confidence, which has been slowly but surely repaired since the mayhem on September 11th, remained significant. The 100 index finished the session a net 98, or 1.9 per cent, lower at 5,146.2.

The worst performance among the other main indices came from the Techmark 100, which dropped 39.01, or 2.6 per cent, to 1,451.33, while the FTSE 250 fell 63.4, or 1.1 per cent, to 5,628.5. The all-embracing FTSE All-Share index gave up 44.12, or 1.75 per cent, to 2,473.67.

Most of whatever action there was in the morning period tended to be confined to buying the more defensive stocks utilities and tobacco stocks and selling the riskier areas of the market, such as the recently buoyant TMTs (technology, media and telecoms stocks).

There was no surprise that the main casualties of the day's events were airline and related stocks, such as British Airways whose shares fell about 13 per cent, before rallying, and BAA, whose shares ended the session down almost 5 per cent.

Turnover in equities was 1.74 billion shares.