FTSE 100 follows global stock markets lower amid soaring energy prices

FTSE 100 index plunges into crimson as global stock markets are hit by soaring energy prices, inflation fears and China property disaster

    (*100*)The FTSE 100 and FTSE 250 slipped by 1.6% and a couple of% respectively this morning

    (*100*)UK pure fuel prices surged 40% as oil prices as soon as once more prolonged good points 

    (*100*)The IMF has revealed a weaker street to recovery for the the global financial system 

The London stock markets slumped almost 2 per cent into the crimson right this moment as a poisonous mixture of soaring energy prices, inflation fears and nervousness over the Chinese financial system prompted merchants to unload shares.

The FTSE 100 index was final 128 factors or 1.8 per cent down at 6,954, whereas the extra UK-focused FTSE 250 index nursed a lack of 467 factors or 2 per cent to 22,263.

Alarm bells rang as UK wholseale pure fuel prices rocketed 40 per cent to an all-time excessive and world oil prices prolonged good points seen over the previous week. Growing wvidence of inflationary pressures at residence and overseas can also be weighing on investor sentiment. 

London stock markets adopted European and Asian counterparts lower this morning

Natural gas prices are soaring

Natural fuel prices are soaring 

‘There’s an enormous concern over rising inflationary pressures coming on the similar time of proof that the UK recovery is slowing, and fears of stagflation are understandably rising too,’ stated Stuart Cole, head of macro economics at Equiti Capital.

Europe’s Stoxx 600 is down by greater than 2 per cent this morning, with journey & leisure shares main losses, whereas Hong Kong shares closed at their lowest stage in 12 months.

Concerns concerning the European recovery are additionally heightened as new information this morning exhibits eurozone retail gross sales had been weaker than anticipated in August with customers reining in spending on meals, drinks and tobacco. 

Germany authorities additionally revealed right this moment that the nation’s manufacturing facility orders collapsed by 7.7 per cent in August.

‘It’s (fuel prices) actually soaring for the time being and the question is whether or not central banks are going to behave on this from an inflation perspective, which is ready to go greater, or from a development perspective, which is ready to go lower,’ stated Bert Colijn, senior economist at ING.

Oil prices are additionally enjoying on market sentiment within the US, the place stock index futures fell about 1 per cent. US traders are additionally spooked by the continued stalemate in Congress over the federal government debt ceiling.

All eyes will probably be on the US non-public payrolls information, due later right this moment.

Further market nerves are being pushed by uncertainty over when and if Chinese authorities will step in to cushion the contagion danger from extremely indebted property developer Evergrande.

Inflation, rising energy prices and the Evergrande fallout are exacerbated by revised forecasts from the International Monetary Fund, which stated it now expects global financial development in 2021 to fall barely under its July forecast of 6 per cent.

IMF chief Kristalina Georgieva cited dangers related to debt, inflation and divergent financial developments within the wake of the pandemic as she painted a murkier outlook for the global financial system.

She stated: ‘We face a global recovery that continues to be ‘hobbled’ by the pandemic and its affect. We are unable to stroll ahead correctly – it’s like strolling with stones in our footwear.’

Government bond yields are on the rise globally, with 10-year gilts buying and selling at their highest stage since May 2019.


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