THERE was an uneasy feeling around trading desks as share prices fell sharply late in the session, mirroring a sudden sell off in the USbond market, which in turn brought heavy pressure to bear on gilts and other European bonds.
Such was the pressure exerted in global bond markets, that the FTSE 100 index, which earlier looked like launching a determined move on its all time intraday high, finished the session only modestly higher, up six points at 4,051.2.
The late retreat was only partly mirrored by the second line and smaller stocks. The FTSE Mid 250 index closed only fractionally below the day's best level, ending 13.9 up at 4,435.8, against a session high of 4,437.4, while the SmallCap finished 4.1 ahead at 2,166.9.
Dealers said the sell off in US bonds reflected a fall in the dollar and worries about today's non farm payroll report for November. A big increase in employment could see more pressure emerge in Treasury bonds.
Adding to the worries circulating in London was a sudden bout of weakness in Reed International whose shares plummeted in the wake of second thoughts after a trading update delivered by the publishing and information services group.
One of the best Footsie performers during the morning, Reed was transformed after a closer scrutiny of the comments made by the group and eventually led the losers list by a long way. One big US broker was said to have been selling exceptional amounts of stock.
Turnover at 6 p.m. was a hefty 910.8 million shares, well ahead of recent levels. Traders pointed out, however, that daily customer business was dismal. Retail business on Wednesday was £873.1 million.
