Early gains wiped out as stocks slide
THE FTSE 100 failed to hold on to its early gains yesterday, sliding back into the red.
The index was down 11.02 points, or 0.16 per cent, at 6,995.91.
Top-flight stocks had moved back into positive territory earlier in the day as global stock markets tentatively recovered from a widespread sell-off.
A day earlier, the FTSE 100 suffered its largest one-day drop since June after falling 1.9 per cent.
Neil Wilson, of Markets.com, had warned earlier on Friday that sentiment was still “fragile” and markets could be in for a “dead cat bounce”: a short-lived recovery after a substantial fall.
European stocks experienced a similar reversal following an initial recovery. The French Cac was down 0.14 per cent and the German Dax was down 0.13 per cent.
Investors have been heading for the exit on concerns over rising US bond yields, with America’s massive borrowing looking vulnerable given the costs of servicing the debt.
Markets have also been jittery over mounting trade tensions between the US and China, which could hit global demand.
“Traders are keen to square up their books ahead of the weekend,” said CMC Markets UK market analyst David Madden.
“The global equity rout originated
11 Points fall on the FTSE 100 index in
London last night
in the US, and the moves continue to be US driven, and European dealers are keen to cash in their holdings as Wall Street still has several hours more trading left. “
Shares in Aim-listed Patisserie Holdings are still suspended but the company has put forward a rescue plan which will involve chairman Luke Johnson stumping up loans of as much as £20 million.
The company also hopes to raise £15 million by issuing new shares.
Shares in Sports Direct were trading 1.58 per cent higher after the company announced it had bought the freehold of the Frasers store in Glasgow for £95 million.
In currency markets, the pound was lower by 0.5 per cent against the US dollar at 1.316 and dropped 0.28 per cent versus the euro to 1.380.
Brent crude prices were also lower, down 0.3 per cent at 80.06 US dollars (£60.84) per barrel.
The biggest risers on the FTSE 100 were Scottish Mortgage Investment Trust, up 26.6p to 481p, Barratt Developments up 26p to 513.8p, Fresnillo up 37.4p to 876.4p, and Ocado Group up 33.8p to 813.2p.
The biggest fallers on the FTSE 100 were Imperial Brands, down 161.5p to 2,516.5p, British American Tobacco down 133p to 3,272p, United Utilities Group down 17p to 687.4p, and Hargreaves Lansdown down 44p to 1,806.5p.