FTSE sees worst year of declines since 2008

THE FTSE 100 has suffered its worst year since the financial crisis erupted more than a decade ago.

Britain’s index of blue- chip firms ended 2020 on a low, tumbling 95.3 points – 1.45 per cent – to 6460.5 yesterday.

It took the top flight’s losses for the year to 14.3 per cent, the biggest annual drop since 2008 when it endured a 31 per cent slump.

The Footsie has also performed badly against its main competitor indices around the world.

Germany’s DAX index of the country’s 30 top firms, for example, managed a 3.5 per cent rise in 2020, America’s S& P 500 rose 15 per cent, while France’s CAC fell 6.8 per cent.

The FTSE 100 has struggled to recover from brutal losses suffered in February and March as much of Europe was plunged into Covid lockdowns.

It crashed to a low of 4993.9 in March and has been slowly recovering for much of the time since then.

Yesterday’s fall was fuelled by the extending of Tier 4 coronavirus restrictions to new parts of the country and uncertainties about the delivery of the Brexit deal.

The share slide has impacted millions of small investors as well as those saving into company pension funds.

Russ Mould, investment director at City firm AJ Bell, said: “The UK was a turgid performer, weighed down by its sector mix and heavy exposure to banks and oils and limited exposure to technology, as well as Brexit and perceptions ( fair or unfair) that the pandemic has not been handled that well.”

But Sue Noffke, at money manager Schroders, urged a long- term view. She said: “Stock markets look forward so they are a bit like driving a car – you have your eyes on the horizon, rather than the pothole that’s in front of you.”