By Tricia Wright. LONDON | Thu May 23, 2013 9:22am BST. LONDON (Reuters) - The FTSE 100 fell sharply on Thursday, dropping off 13-year highs on weak Chinese economic data and worries the U.S.

The Nikkei 225 index closed down 7.32pc - or 1,143.28 points - at 14,483.98 - the biggest daily points fall since April 2000, and larger than the drop seen when the country was rocked by the Fukushima nuclear disaster in March 2011.

The updated figures from the Office for National Statistics showed that the UK's dominant services sector, which accounts for three quarters of national output, drove the recovery - growing 0.6pc over the three months.

The company sold its slots at the London airport to Easyjet for �20m, blaming an increase in airport charges. Flybe said it would continue all flights between the islands and other UK airports.

Halfords Group Plc (HFD), the U.K.'s biggest seller of bicycles, fell the most ever after announcing a surprise dividend reduction to boost investment in training workers, revamping stores and improving its Web business.

China's manufacturing is contracting in May for the first time in seven months, adding to signs that economic growth is losing steam for a second quarter.

International Monetary Fund Managing Director Christine Lagarde is testifying this morning at a Paris court investigating her decision to allow an arbitration that benefited a supporter of former President Nicolas Sarkozy.

Mothercare posted another big loss in the last financial year, but the UK retailer said it was making good progress with its turnaround plan.

Speaking after he delivered the annual British Retail Consortium lecture, Tim Steiner said the reaction of Waitrose to Ocado's tie-up with Morrisons has been a �joke�.

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