Tuesday, August 9, 2011

Meltdown continues as FTSE drops 200 Points in first 2 Hours of trading and drops to lowest level for more than a year - 9th Aug 2011

The FTSE 100 Index was trading below the 5,000 barrier for the first time in more than a year today as the turmoil in financial markets intensified.

A slump of more than 5 per cent for Wall Street's Dow Jones Industrial Average triggered huge losses in Asia and had a knock-on effect for European markets.

The FTSE 100 Index stood 177.4 points lower at 4891.6, but the decline could have been much worse given that financial spread betting firms were forecasting losses of more than 300 points prior to London's opening.

In Tokyo the Nikkei was down 2.08 per cent and in Hong Kong the Hang Seng fell by more than 3 per cent.

In the morning session, the Nikkei plunged 4.4 per cent to 8,694.31, while the Hang Seng plummeted 7.3 percent to 18,998.51. South Korea's Kospi index plummeted 8.2 percent to 1,716.05.

Banks were the biggest casualties after recession fears sparked big share price falls for America's major banks last night.

Royal Bank of Scotland slipped 1.5p to 25.8p, a drop of 5 per cent, while Barclays fell 8.3p to 167.1p.

Oil companies were also hurt by a further slide in energy prices, with BP down nearly 5 per cent or 17.65p at 385.4p and Royal Dutch Shell 83.25p down at 1811p.

In corporate news, shares in bakery chain Greggs slumped 10 per cent after it reported a rise in half-year profits but said the second half of the year was likely to be tough. The stock fell 49.05p to 432.95p.

The slump in the London stock market followed a plunge of more than 100 points for an unprecedented fourth successive day yesterday.

The value of Britain’s leading companies has now fallen by £210billion in little over a week, a slump of nearly 14 per cent, following yesterday’s £46billion sell-off. Read More