Markets turn as FTSE and Dow both slump
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Version 0 of 1. Having started the day in buoyant mood - supposedly on the back of Barack Obama's victory - the markets have all turned. The FTSE 100 closed the day down 1.58% - or 93 points - at 5791.63 and the FTSE 250 off 2% at 11961.32, while on Wall Street the Dow Jones was down 2.52% - or around 330 points - at around 12912 as London markets closed. The selling started about halfway through the European trading session when the European commission said the eurozone will struggle to emerge from a double-dip recession next year as deep budget cuts stifle growth - adding that the eurozone as a whole would contract by 0.4% this year and grow by 0.1% in 2013. Angus Campbell head of market analysis at Capital Spreads, said: <blockquote>[The warning from the eurozone] acted as a stiff reminder to investors that the eurozone crisis is far from over and any buyers that were basking in the euphoria of an Obama victory were swiftly brushed aside. Then later when US investors awoke with a hangover it swiftly dawned on them that the fiscal cliff is now a palpable reality that will not go away and needs to be addressed by the two warring factions of a Democrat president and Republican House of Representatives. We all saw how difficult it was to reach consensus on the lifting of the debt ceiling not that long ago and so agreement on the fiscal cliff is likely to be just as contentious making the weeks ahead even more nerve wracking.</blockquote> Randgold Resources led the FTSE fallers by shedding more than 6% to £69.45 - after releasing poor Q3 numbers in which it disappointed analysts with output figures. Burberry Group was not far behind - 4.23% off at £12.17 - as broker Investec cut its rating on the fashion group's shares to a "hold" from a "buy". Meanwhile, among the mid-caps, defence group Chemring was a major casualty, losing almost 5% to 234.5p as the US private equity firm Carlyle said it would not be making an offer for the company. Meanwhile online grocer Ocado lost 4.6% of its value as market watchers speculated that an effort to implement a sale and leaseback deal on it distribution centre was proving difficult to secure. |