Stock markets on both sides of the Atlantic concluded their worst week in months on Friday as deepening economic gloom raised expectations that the US Federal Reserve would be forced to cut rates again in the face of mounting credit losses.

The S&P 500 was down 3 per cent for the week. In London, the FTSE 100 fell 3.7 per cent on the week, while the FTSE Eurofirst 300 was down 3.1 per cent, their worst performances since the credit squeeze took hold at the end of July.