FTSE 100 slinks to lowest since 2003
Thursday, 16 Oct 2008 17:46
FTSE 100 at five-year low
A global sell-off continued in London today with the FTSE 100 dropping 5.35 per cent on the day – following a seven per cent drop on Wednesday.
As traders brush aside the optimism of the bank rescue, fears of further bank losses to emerge from the woodwork and the impending recession are making investors fretful.
The index of top 100 firms ended the day down 218.67 points to 3,861.39 – the lowest level in five years.
After initial morning drops over five, the index made up ground, but drops on Wall Street sapped traders' reserve.
Biggest falls went to Thomas Cook and TUI Travel – with the travel firms down 23.36 per cent and 25.45 per cent respectively.
TUI suffered as the German TUI AG ruled out a buyout.
Insurers Old Mutual and Prudential dropped 19.12 per cent and 18.31 per cent, while builders merchant Wolseley – often a bellwether for the construction industry – was down 17.56 per cent.
Heading the gains was packaging firm Rexam up 8.19 per cent.
Schroders Non-voting was up 7.79 per cent, Lloyds TSB gained 5.93 per cent, Royal Bank of Scotland rose 5.83 per cent and Centrica was up 5.23 per cent.
In New York, the Dow dropped in early trading by 4.27 per cent, although by 12:02 EDT (17:02 BST) it was down 1.25 per cent to 8,470.63.
In Europe, gloom also continued with the Cac 40 down 5.92 per cent in Paris and the Dax down 4.91 per cent in Frankfurt.
Ryan Kneale, market analyst at BetsForTraders.com, said: "The markets appear to have taken one step forward and two steps back this week, as energy and mining shares collapsed along with the increased market talk of a 'global recession'.
"Elsewhere, banking and retail stocks continue to appear shaky as their profitability looks to take a nose dive over the next 12 months."