FTSE 100 down despite economic forecast

Positive forecasts for the economy failed to move the FTSE 100 higher in early trading, and the index dropped 0.48 per cent to 4,415.26 by 08:23 BST.

Thinktank NIESR has estimated Britain is already through the worst of the recession and the economy has started to grow again.

But investors remained cautious and the index remains stuck below the 4,500 threshold.

Cruise liner Carnival led the fall, down by 2.12 per cent, while retailer Kingfisher followed with a 1.68 per cent dip and Drax Group, which is set to exit the index after the latest reshuffle, was 1.36 per cent down.

Thomas Cook Group shares were heading higher again however, after being dragged down yesterday on uncertainty over its future.

The travel firm gained 4.22 per cent, closely followed by technology firm Invensys, which was up by 2.95 per cent.

Last night in the US, the Dow Jones was off by 0.27 per cent, while the S&P 500 finished 0.35 per cent lower.