MARKET WATCH

Shares dropped sharply in London on Tuesday after closing at a record high of 6339.4 on Monday. The 175-point fall in early trading followed a drop in New York late on Monday and was seen by many as a long-overdue correction. By midday, the index recovered slightly but was still down 162.2 points at 6352.8. […]

Shares dropped sharply in London on Tuesday after closing at a record high of 6339.4 on Monday.

The 175-point fall in early trading followed a drop in New York late on Monday and was seen by many as a long-overdue correction.

By midday, the index recovered slightly but was still down 162.2 points at 6352.8. The mid-250 index was similarly lower, down 86.1 at 5763.3 by midday.

Engineering shares mostly followed the index downwards. Glynwed fell a further 2p to 288.5p, following a 6p fall on Monday after it sold the last of its West Midlands metal processing activities to US company Niagara Corporation in a £21.2m deal.

British Aerospace shares were down in line with the market, falling 23.5p to 425.5p. The drop came a day after the company revealed it had visited Libya to discuss the country’s civil aviation needs. But it would not comment on reports that it was discussing a £6bn deal to provide new Airbus aircraft, train staff and revamp its airports.

Smiths Industries was another faller on Tuesday, down 49p at 992p.

Vickers was also 5.5p lower at 160p, while the Weir Group’s shares were 6.5p down at 266.5p.

Analysts said that while downbeat sentiment would continue to affect engineering stocks along with the rest of the market, the sector was due for a re-rating and this made them a good prospect.