Around the World's Markets: London

EQUITIES FELL sharply although closing above their lowest levels. Footsie was cut 158.8 points to 5,132.9 in active trading.

Dismal trading news, profit downgradings and the seeming end of any hope of a concerted G7 cut in interest rates to fight recessionary influences prompted the latest set back.

Among blue chips British Aerospace was lowered on fears its cash flow from Saudi Arabia may be delayed and Bass weakened on a rush of profit downgradings.