US policy fears push markets lower

Press Association
Barack Obama
Barack Obama

Financial markets dropped on concerns that newly re-elected US President Barack Obama will struggle to thrash out a budget deal with a divided Congress, and as the EU cut its economic growth forecasts.

The ease with which Mr Obama secured four more years in the White House - avoiding the uncertainty of ballot recounts, as in 2000 - had been welcomed in the markets early in the day. However, as the day wore on, investors grew concerned over the implications of a still divided Congress.