Ocado takes £575m hit in stock market sell-off
Grocery company Ocado suffered its heaviest one- day loss ever as more than £575m was wiped off its market value.
Shares in the tech-focused delivery firm slumped 9.7pc, or 83.2p, to 772.8p amid a wider stock market sell-off caused by rising geopolitical tensions.
The highly valued company bore the brunt of investor panic as market players braced for the fallout from Saudi Arabia’s involvement in the death of journalist Jamal Khashoggi and fears over the economic impact of a trade war between the US and china failed to abate.
Khashoggi’s death in the Saudi consulate in Turkey has prompted major global companies and business figures to spurn the kingdom’s regime, leaving investors wary of a possible crisis.
Investor pessimism surrounding china has also grown louder, as President Trump’s economic adviser Larry Kudlow accused the chinese of refusing to engage in trade talks.
Meanwhile Zhang Qingli, a chinese official, told a group of American business leaders in Beijing that china was not intimidated by the Trump administration.
Prashant chandran, a fund manager at investment firm Legg Mason, warned a protracted trade war between the US and china could knock as much as 0.7pc off the growth rate of china’s economy.
His comments came as investor sentiment on the country rapidly soured, just a day after chinese stocks had rallied.
Hong Kong’s Hang Seng index of major listed companies dipped 3.1pc, china’s Shanghai stock exchange lost 2.3pc and Japan’s Nikkei skidded 2.7pc.
The torrid day for global markets continued in the US as disappointing corporate earnings from heavyweight US companies further panicked investors.
Machinery firm caterpillar and Post-it maker 3M revealed lacklustre results, pulling major indices into the red. Caterpillar, which is often used as a bellwether of the US economy due to its heavy construction focus, fell 7.7pc as it said costs were rising due to higher steel prices and tariffs.
The Dow Jones Industrial Average, an index of 30 significant US companies, fell 0.5pc.
The S&P 500, which comprises America’s largest companies, slipped 0.6pc and was set for its fifth weekly decline, while the Nasdaq shed 0.4pc.
european markets were not immune to the downturn, as ongoing concerns over Brexit and Italy’s fiscal plans added to the litany of geopolitical tensions. Germany’s Dax ended the day 2.2pc lower, and France’s cAc down 1.7pc.
Back in the UK, the FTSE 100 experienced more modest losses as it closed 1.2pc, or 87.59 points lower, at 6955.21. Gold miner Fresnillo helped to drag the blue-chip index higher, as the rising price of gold buoyed its shares.
Pushed higher by a note from Bank of America Merrill Lynch on Monday, which called it the new ‘go- to’ precious metals miner in London now that major competitor randgold is merging with US rival Barrick Gold, Fresnillo’s shares climbed 9.1pc, or 81.6p, to 977.2p.
But heavy losses from major FTSe companies, including ocado, countered the miner’s gains.
GVC, owner of gambling company Ladbrokes coral, tanked for the second day in a row amid concerns that chancellor Philip Hammond will increase the tax paid by offshore gambling companies.
GVc’s shares slid 7.2pc, or 67p, to 870.5p, adding to Monday’s 2.3pc fall.
Wealth manager St James’s Place also dropped by 5.3pc, or 54.3p, to 980.2p, despite increasing the amount of wealthy clients’ money it was looking after by £2.5bn over the last three months.