Biggest Slide on FTSE in Six Weeks
Financial Market Comments from David Jones, Chief Market Strategist, IG Index.
In early morning trading UK shares are down across the board with the FTSE off by around 90 points.
It’s a wall of red for blue chip stocks so far, with Morrison the only FTSE 100 company slightly ahead on the day.
Mining shares are the biggest losers on weaker commodities – this is always a volatile sector of course and has led the recovery over recent weeks.
The real test now is whether investors are happy to view this sell off as yet another opportunity to load up their holdings ahead of an anticipated push higher.
The news that Japan has come out of recession has not been enough to lift markets – growth was positive but not as strong as expected.
While today’s slide is so far the biggest fall seen on the UK index in six weeks, it was only at the end of last week that we saw the highest level reached so far this year.
At the moment, the broader recovery is still in place and it would not be a surprise to see shares claw back the lost ground over the next few days.
Looking ahead to the US open, at the moment it looks like the Dow Jones index is going to start off around 150 points lower at 9170.
While, like the FTSE, this is a heavy fall to start the week, only a slide below the 9000 level is likely to give investors cause for concern by suggesting that this could be the beginning of a significant move lower rather than just a brief correction in the recovery.
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Good Luck!
DB
The above comments do not constitute investment advice Clean Financial accepts no responsibility for any use that may be made of them.
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