FTSE 100 drops further after US jobs report

(Close): The FTSE 100 extended its losses after the release of the latest US jobs figures.

The US economy added 173,000 jobs in August, which was slightly below analysts' forecasts.

However, the jobless rate dropped to 5.1%, which is the lowest since April 2008.

The FTSE 100 index - which had been down about 1.7% before the figures were released - dropped further, closing down 151 points, or 2.4%, at 6,042.92.

The jobs report is the last before the US Federal Reserve meets later this month to determine whether to increase interest rates.

Analysts said the jobs data failed to give a clear cut indication of what the Fed would do.

"Although there were no fireworks in the report, it was by no means disappointing," said Ranko Berich, head of market analysis at Monex Europe.

Among individual shares, Next shares dropped 2.9% after Exane BNP Paribas cut its rating on the firm to "underperform" from "neutral".

Retail shares also came under pressure after a downbeat survey from accountancy and business advisory firm BDO.

The study found High Street sales were down 4.3% in August from a year earlier.

In the FTSE 250, shares in online betting company Bwin.party gave up early gains to stand 4.5% lower. Bwin has agreed to a £1.1bn takeover offer from GVC, having previously accepted a rival offer from 888 Holdings. Shares in 888 were up 1%.

On the currency markets, the pound fell 0.46% against the dollar to $1.5187, and dropped 0.4% against the euro to €1.3659.