Record Footsie fall despite late flourish

London shares put on a bright show during the last three days of 2008. It's just a pity about the 363 days that preceded them.

The FTSE 100 index was up 38.68 points at 4431.36 in today's shortened trading session. But the year's fall of almost 32% is the biggest annual drop since the blue-chip index replaced the old FT 30 index in 1984. Losses among second-liners have been even bigger. The FTSE 250 index today rose 5.8 points to 6456.9, but its loss on the year is a hefty 39%.

A mixed bag was making the running today. Eurasian Natural Resources added 17¾p to 357p and RSA Insurance rose 5.7p to 145.4p while Cable & Wireless firmed 4.5p to 159.2p. Stock shortages were reckoned to have exaggerated some of the movements.

Retailer Next continued to reflect the heavy discounting in the shops after a poor run-up to Christmas. Its shares fell 13p to 1080p. B&Q owner Kingfisher shed 1p to 134.4p.

Bank shares were also marked lower, with Lloyds TSB shading 0.5p to 126p - way below its rights-issue price of 166p. Merger partner HBOS shed 0.8p to 68.2p.

It has been an encouraging end to the year for subprime lender Cattles. Its shares firmed 1p to 17p, stretching the rise on the week to 5p. Admittedly, the shares were trading at about 131p in September, but they have since been hit by the banking crisis.

Hopes are high the group may secure its banking licence in mid-2009. But brokers say management must do more to reassure the market it is actively looking to clear up liquidity issues, and it is unlikely Cattles will be able to restore the dividend until after 2010.

Shares scored useful gains in a year-end-inspired rally on Wall Street overnight, but there is no getting away from the fact it has been a miserable year for investors. Dealers say it will prove to be the worst performance by the stock market since the Depression. The Dow finished 184.46 higher at 8668.39, still about 35% lower than it started the year. The broader S&P 500 index is set to post its biggest annual fall since 1931.

News of a fresh bailout for General Motors provided early impetus. But some question whether the $6 billion (£4.1 billion) loan will be enough for GM. The shares rose 5% to $3.78 while Ford put on 1.6% to $2.26 and car trader AutoNation accelerated 7.2% to $9.19.

Tokyo markets were closed but Hong Kong - where shares have shed almost half their value in 2008, marking their worst year in more than three decades - staged a half-day session.

The Hang Seng index ended a five-year winning streak to plunge 48.3% in 2008, its worst performance since a 60% slump in 1974, fuelled by the world oil crisis. The loss follows the index's best gain in seven years in 2007, a factor that analysts said only makes 2008's slump look more pronounced.

The index has lost 55% in 14 months since hitting its all-time high of close to 32,000 points at end-October 2007. It ended today's session up 151.98 points at 14.387.48.