Former Chelsea and West Ham coach Clarke was the man Hughton wanted to succeed Colin Calderwood, who quit to become Hibs manager last week.
But he will not be returning to St James’ Park, where he worked alongside Ruud Gullit in the late Nineties and was caretaker boss for one game before Sir Bobby Robson’s arrival 11 years ago.
Though he was keen to work alongside Hughton and was not looking for the same financial package he was on at Stamford Bridge or even at West Ham, it is understood he still could not agree terms with Newcastle. The club last night claimed they had not offered him the job.
It is another blow for the beleaguered Hughton, whose future has been the subject of speculation.
Newcastle were forced to issue a statement minutes after Wednesday’s 4-0 Carling Cup defeat by Arsenal denying Hughton’s position was in danger, with betting having earlier been suspended.
And although Newcastle insist contract talks with Hughton will open in the new year – his deal expires at the end of the season – a run of bad results could leave him on the brink. Throw in the fact that star striker Andy Carroll has had two court appearances in the past fortnight and it has not been the ideal preparation ahead of Sunday’s Tyne-Wear derby.
The cup exit saw Tim Krul, deputising for the injured Steve Harper, drop his first clanger since coming into the side. But Hughton said: “He won’t be fazed by that mistake . He is a big character, who can put mistakes behind him.”