London's leading shares have been in negative territory since the latest Italian bond auction spooked investors this morning. Italy paid a record 6.29%, although this was below the 7%-plus seen on secondary markets last week - a level that triggered bailouts of Ireland and Portugal.
The FTSE 100 index was down nearly 40 points by mid-afternoon, falling 0.7% to 5507. Insurers Resolution, Legal & General and Prudential were among the biggest fallers, as were financial stocks Standard Chartered, Schroders and Barclays. The latter dropped 2.8% to 173.9p after Goldman Sachs cut its rating on the bank to "sell" from "neutral," arguing that it would be hit the most by proposed UK banking reforms.
Defensive stocks such as Vodafone, sought after partly because of its dividends, were among the biggest risers. Vodafone added 2p, or 1.2%, to 182.2p. ITV, boosted by a trading update, was the biggest gainer, up 4% at 66.2p.
