The FTSE 100 dropped 5.2% between last Monday and Friday, making last week the worst for the London share index in 2015 so far. The 5.2% loss equates to a fall of 363 points.
Friday was an especially bad day for the prominent UK share index, with a fall of 2.8%. This was not just an overall drop, but a pretty much universal one for the companies that make up the index with almost all of them falling in value or managing to only hold steady. Just one company managed to actually record a gain on Friday; Royal Mail, which experienced a rise of 1.6%.
UK shares are not the only ones suffering at present, nor the only ones to be hit especially hard last Friday. The stock exchanges of Frankfurt and Paris fell by 3% on Friday.
Over in the US, major Wall Street indexes such as the Dow Jones, S&P 500 and Nasdaq all recorded falls around the 3% mark as well. The S&P 500 was hit especially hard on Friday, experiencing its biggest single-day drop for almost four years. It fell by 3.19% or 64.8 points. Nasdaq fell even further, with a drop of 3.52%.
The widespread fall in share values has been attributed in no small part to disappointing manufacturing figures from China, which is one of the biggest manufacturing centres for large and small businesses across the world. The less-than-stellar data has worsened economic fears surrounding many major markets. China’s own stock market is also performing poorly at present, with the government investing state pension funds in an effort to stimulate the market and stop the rapid slide in values. According to some experts, such as CMC Markets analyst Nicholas Teo, these and other issues with China’s economy could hold back the global recovery.
Oil prices are also falling, and this is very much a related phenomenon in terms of its impact on a number of major companies in many markets. In the US, in particular, the New York crude oil price fell below the US$40 per barrel mark for the first time since the global recession.
Last week’s poor performance of the FTSE 100 index may have been the worse of any single week this year, but it is merely the continuation of a current trend. The FTSE 100 has now recorded a drop for nine sessions in a row – the longest period of consistent loss since 2011.
