The riots in London provided the perfect backdrop to events in the stock market at the close of trading, as the FTSE 100 index slumped in the wake of the US downgrade.

The FTSE 100 index closed hovering just above the 5,000 level, as the US stock markets opened and more negative news emerged.

After downgrading its AAA rating, agency Standard & Poor's also downgraded mortgage banks Fannie Mae and Freddie Mac and warned the US faced a 'one in three' chance of a further downgrade of its debt.

The impact on the UK blue chip index was significant, closing at 5,068.95 its lowest level in more than a year.

Copper miner Kazakhmys (KAZ.L) was the biggest faller with its share price slumping by 10.1 per cent to 957p.

It was joined at the bottom by Vedanta Resources (VED.L), falling 9.3 per cent to 1,287p.

Engineers GKN (GKN.L) and Weir (WEIR.L) both dropped 8.7 per cent to 177.7p and 1,580p, respectively. Microchip manufacturer Arm Holdings (ARM.L), meanwhile close 8.3 per cent lower at 464p.

The only riser at the close of trading was Randgold Resources (RRS.L) climbing 7.4 per cent higher to 6,145p.

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