LONDON MARKETS: FTSE 100 Teetering On Edge Of Correction; Shire Sinks In London

By Carla Mozee, MarketWatch

LONDON (MarketWatch) -- U.K. stocks were slammed Wednesday, driving the FTSE 100 benchmark close to correction territory as worries about slowing global growth shook up equities throughout Europe and on Wall Street.

Shire PLC stood out as the FTSE's biggest loser, as its shares plunged after U.S. drug maker AbbVie Inc. indicated it's reconsidering a plan to acquire the biopharmaceutical firm.

Investors also assessed U.K. labor-market data released Wednesday, which showed unemployment falling to its lowest level since 2008.

The Office for National Statistics said the unemployment rate between June to August fell to 6%, compared with the 6.1% reading anticipated by economists. Average weekly earnings including bonuses rose 0.7% annually, and increased by 0.9% excluding bonuses. But the growth lags inflation, which stood at 1.2% in September, so real wages are still declining.

Markets: The FTSE 100 fell 2.8% to 6,211.64, the lowest finish since late June 2013, according to FactSet data. The FTSE has fallen 9.7% from its 2014 closing high that was hit in May, bordering a correction, defined as a drop of 10% or more.

The benchmark's loss accelerated as trading began on Wall Street, where stocks sank after the release of three downbeat reports about the U.S. economy. European stocks tumbled further after Wall Street's open, putting the Stoxx Europe 600 down 11% from its 2014 closing high.

On the currency side, the pound (GBPUSD) briefly rose then fell after the U.K. jobs data, as the Bank of England wants to see wage growth trending higher before it begins to raise interest rates. Late Wednesday, sterling was buying $1.5944 compared with $1.5905 late Tuesday.

Shire shares ended 22% lower after AbbVie Inc. (ABBV) signaled late Tuesday it may be rethinking its planned purchase of Shire because new tax rules from the U.S. Treasury Department make the deal less attractive. AbbVie's board will meet next week to discuss their recommendation to buy Shire.

Other drug makers seen as possible targets for tax inversion deals finished lower. AstraZeneca PLC (AZN) dropped 3.2% and Smith & Nephew PLC fell 2.5%.

In other action, shares of Balfour Beatty PLC climbed 5.3% after the construction services company named Leo Quinn as its chief executive. He previously served for five years as CEO at defense technology maker QinetiQ Group PLC . Shares of QinetiQ fell 11.8%.

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