Fears that markets could be on the brink of another slump continued to weigh this morning as investors digested losses seen around the globe.

Following falls in the US, where the Dow finished down 200.72 points at 8,339.01 and the S&P 500 shed 28.19 points to 893.04, and with the Nikkei off 276.66 points at 9,549.61, UK shares dipped at opening, down 20 points initially at 4,214.88.

The falls followed a report from the World Bank yesterday which downgraded forecasts for growth for not only the UK - where it said GDP growth would contract by more than 5% this year - but in other countries around the world.

'The world is entering an era of slower growth that will require tighter and more effective oversight of the financial system,' said the authors of the Bank's latest report. 

Developing countries - excluding China and India - are expected to shrink 1.6%, causing continued job losses and throwing more people into poverty and the lender now believes global output will contract 2.9% in 2009

Chief among the fallers on the FTSE this morning was miner Anglo American, which late last night rejected Xstrata's merger offer which would have created a $67 billion giant, calling the terms of the deal 'totally unacceptable.'

The group’s shares - which topped the FTSE 100 yesterday - were down 4% or 69p, at £16.29, leading the fallers’ column.

Elsewhere, Thomas Cook Group also extended losses seen on Monday, shares down a further 5.75p at 201.25p, amid ongoing worries about its future.