Dismal Christmas trading figures from supermarkets Tesco and Morrisons sparked falls across the sector in a gloomy session for festive retail updates.

Morrisons suffered the biggest fall, down 8% or 19.7p to 234.5p, after it said profits will be at the bottom end of the City's current forecast range following a 5.6% decline in like-for-like sales.

The wider FTSE-100 Index was also in the red - down 30.4 points at 6691.3 - mirroring falls across Europe and Wall Street.

The Bank of England's decision to keep interest rates at 0.5% was widely expected while the European Central Bank also kept policy on hold, but comments from president Mario Draghi failed to reassure markets that further tools were available to spur recovery in the eurozone.

Germany's Dax and the Cac 40 in France closed nearly 1% lower.

In London, Morrisons led declines, with Tesco following close behind after it disappointed City analysts with a 2.4% decline in UK like-for-like sales for the Christmas period.

Chief executive Philip Clarke blamed the fall on difficult grocery market conditions and insisted investment in the business continued to pay off. However, shares fell by 4p to 324.4p, a drop of 1%.

Sainsbury's, which posted flat sales figures this week, was down 8.6p to 351.4p.

But Marks & Spencer shares weathered the storm after it reported a 2.1% decline in quarterly general merchandise sales, offset by a better Christmas when underlying sales rose 0.5%.

Having fluctuated ahead of the trading update, M&S shares closed 4% or 16p higher at 460.9p amid relief the performance was not worse.

Bookmaker William Hill was another big faller in the top flight after David Cameron voiced concern in parliament about fixed-odds betting terminals.

They have been a big revenue driver for the industry but those taps could be turned off if a review leads to the government backing Labour's calls for greater regulation of the betting industry.

A downbeat note on the sector from Barclays added to the gloom as William Hill's shares slumped 28.7p to 371.1p, a drop of 7%, and FTSE-250 rival Ladbrokes fell 15.6p to 164.1p.

Outside the top flight, Frankie & Benny's and Garfunkel's owner the Restaurant Group fared well after it said that profits for the past year were expected to be ahead of market forecasts, following a 3.5% increase in like-for-like sales. Shares closed the day 34p higher at 629p.

The biggest FTSE-100 risers were Marks & Spencer up 16p to 460.9p, Tullow Oil ahead 25p to 845p, CRH 38p stronger at 1625p and Lloyds Banking Group 1.5p higher at 85.3p.

The biggest FTSE-100 fallers were Morrisons down 19.7p to 234.5p, William Hill off 28.7p to 371.1p, Arm Holdings 69.5p lower at 997.5p and Aberdeen Asset Management 23.7p weaker at 449.6p.