Yesterday the London index saw its biggest slump since March with a drop of 3.18 per cent on the news the government-owned Dubai world would delay debt payments.
The announcement has caused severe uncertainly over the stability of the economic structure in Dubai with a number of companies already seeing their credit rating downgraded.
The banking sector was hit particularly hard yesterday with Barclays, down 7.97 per cent and Royal Bank of Scotland also falling 7.74 per cent.
The news rocked markets around the world with Asia's markets also recorded steep drops.
Tokyo's Nikkei index fell 3.2 per cent, while in Hong Kong the Hang Seng ended down 4.2 per cent.
By 09:00 GMT the FTSE 100 had recovered slightly, down 0.61 per cent from yesterday to 5,162.47.
The announcement has caused severe uncertainly over the stability of the economic structure in Dubai with a number of companies already seeing their credit rating downgraded.
The banking sector was hit particularly hard yesterday with Barclays, down 7.97 per cent and Royal Bank of Scotland also falling 7.74 per cent.
The news rocked markets around the world with Asia's markets also recorded steep drops.
Tokyo's Nikkei index fell 3.2 per cent, while in Hong Kong the Hang Seng ended down 4.2 per cent.
By 09:00 GMT the FTSE 100 had recovered slightly, down 0.61 per cent from yesterday to 5,162.47.
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