Tony Blair has defended the government's economic policy, following a record run of falls on the stock market.

Shares fell sharply for 11 days to 3481 on Monday, its lowest close since October 1995. At one point, the FTSE fell to half the value reached at its peak in December 1999.

Speaking in the Commons, Conservative MP Simon Burns called on the prime minister to apologise to holders of occupational funds who had been adversely affected by the falls on the stock market, and Gordon Brown's tax policy, which has raised £25 billion in revenue.

Tony Blair argued that Britain's economy was among the most stable in the world.

"Firstly, I should point out that stock markets have fallen across the world," he said.

"Secondly I should point out that as a result of the chancellor's management of this economy, we've the lowest inflation, lowest interest rates that we've had for decades.

"We've got the highest employment levels this country's ever had, we've got the lowest unemployment of any major country, and compare and contrast that with three million unemployed under the Conservatives."

Shares initially fell sharply in response to president Bush's state of the union address, following a slight increase on Tuesday.