Jitters over China manufacturing slowdown wipe £38bn off FTSE 100

UK stocks tumble as renewed concern over global economy spooks markets

The FTSE 100 index had 38bn wiped off its value as global stock markets started the year with a rout sparked by fresh fears over the Chinese economy.

Investors returning after the Christmas break were greeted by turmoil on stock exchanges, with Germany's share index posting its worst start to a new year on record and London's FTSE 100 putting in its second-worst start. As European markets closed, Wall Street looked set for the sharpest new year losses since the 1930s.