London’s blue chip share index enjoyed its best January for 24 years despite ending the month with a disappointing session for UK blue chips.

The top flight has risen by more than 6% - or 379 points - since the start of the year, making it the best January performance since 1989 and the third best in the history of the FTSE 100.

But there have been signs that the new year rally is fizzling out, with the FTSE 100 down 46.2 points at 6276.9 as it succumbed to a bout of profit taking.

As well as a flood of corporate announcements, sentiment was also hit after figures on Wednesday showed America’s worst economic performance in three years.

The failure of the US Federal Reserve to signal further action at its two-day meeting yesterday added to the caution, with the Dow Jones Industrial Average on Wall Street also slipping into the red in early trade.

Recent hopes for the global economic recovery have driven world markets to multi-year highs, with London’s top flight at its best level since early 2008.

But as stocks have enjoyed a spectacular month, the pound has seen a grim start to the year, falling to its lowest level against the euro for more than a year in recent days.

It edged slightly higher  to 1.17 euros, but has dropped sharply from more than 1.23 at the start of the month amid fears over the UK’s economy. Sterling held firm at $1.59.

The biggest FTSE 100 risers were Vedanta Resources up 40p to 1204p, Petrofac ahead 23p to 1638p, SABMiller 41p higher at 3150p and Diageo up 24p to 1877p.

The biggest FTSE 100 fallers were AstraZeneca down 99.5p to 3053p, Royal Dutch Shell off 68p to 2294p, Sage Group 8.9p lower at 322.7p and Antofagasta down 27p to 1142p.