Friday morning small business bulletin

Oct 10 2008 By Karen Dent

Global stocks were routed today after recession fears swept markets and left the FTSE 100 Index down by as much as 10%.

The bloodbath started on Wall Street before crossing to Asia, where Japan’s Nikkei suffered its biggest one day drop with a near 10% fall.

The FTSE 100 Index tumbled more than 400 points to below 4000 before settling 255.6 lower at 4054.1 by the end of a turbulent first hour. The top flight has now lost almost 20% of its value since the start of the week.

The latest slump reflected fears of a deep economic downturn and came despite co-ordinated interest rate cuts and this week’s efforts by the UK Government to bolster UK banks.

People’s faith in high street banks has been shaken over the past year and they have also lost trust in Government-backed institutions, research showed today.

On average just 16% of people currently have faith in a major high street bank, less than half the 33% who trusted one of them last year, according to market analyst Mintel.

Instead, one in four people said the Treasury-backed National Savings and Investment (NS&I) was the institution they most trusted with their money, although this had also fallen sharply compared with 12 months ago, when 39% of people put the group at the top of their list.

Toby Clark, senior finance analyst at Mintel, said even though trust in NS&I had decreased, it was relative to the "hammering" the other banks in the survey had endured.

Nationwide and Lloyds TSB occupied second and third spots for most trusted brand, with 20 per cent and 18 per cent of adults respectively trusting the companies.

The other seven banks were all trusted the same on average, with around 16 per cent of consumers saying they had faith in them.

Shoppers racing to snap up warmer clothing as the autumnal weather set in gave a much-needed boost to trade last week, the John Lewis Partnership said today.

The group said total sales across its department stores and Waitrose supermarkets rose 0.9% in the week to October 4, thanks also to the launch of this year’s Christmas collection.

Sales in the department stores dipped by 0.5%, but the fall was a marked improvement on the 8.3% plunge seen the previous week.

The firm said sales of hot water bottles shot up by 200% in the week, while women's shoes also had a strong week in the department stores.

The pound at 9am was US$1.6899 compared to US$1.7222 at the previous close, while the euro at 9am was £0.8056 compared to £0.7929 at the previous close.