By Simon Lambert
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The FTSE 100 plunged further into the red today to compound the misery of investors who have endured the worst month on the stock market in three years in May.
Investors ditching shares on the back of more grim economic news, sent the index of Britain’s biggest companies down more than 1 per cent today.
The Footsie closed down 61 points at 5,260, and May was its worst month of trading since February 2009.
Tumbling price: The stock market has dived into the red and suffered its worst month in more than three years
The index fell 417 points in May â€" losing 7.3 per cent of its value as the eurozone debt crisis has escalated again and investors batten down the hatches.
That performance is slightly worse than last August when the market fell 7.2 per cent. Taking into account today's falls, the market has fallen 477 points since the start of May, losing 8.3 per cent.
Further bad economic news arrived today with the weakest US jobs growth in a year and figures showing that expansion in China’s manufacturing sector all but ground to a halt last month.
Jason Conibear, a director at forex specialists Cambridge Mercantile, said: ‘A few months ago the feeling was that a strong China and resurgent US would steer the eurozone through its current plight.
‘Now the fear is that these economies could themselves be sucked into the rapidly spiralling eurozone vortex.’
Volatile: A fresh escalation of the eurozone debt crisis has hurt the stock market, which is now down on the start of the year
The FTSE 100’s ride into the red has mirrored falls on markets around the world.
Today the Dow Jones Industrial Average was down 1.7% following the poor Non-Farm Payroll jobs figures, while declines were even heavier on markets in Germany and France, with the Dax down 3% and the CAC 40 off 2%.
City commentator David Buik, of the broker BGC Partners, said: ‘The Non-Farm-Payroll numbers were deeply disappointing â€" 69,000 jobs were created in May against expectations of more than 150,000. ‘
At home, confidence took another dent, with figures showing manufacturing orders dried up so badly in May that the Markit/CIPS index saw the second steepest fall in its 20-year history.
The index, which records production, fell to 45.9 from 50.2, well below City hopes for a figure at just below 50. Order books from domestic firms shrunk at a faster rate than export orders.
CIPS chief executive David Noble said: 'The hars h realities of the weak global economy and sluggish domestic demand are bearing down on UK manufacturing.
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If these are the worst market figures since 2009 then this suggests that investers THEN had more confidence in Browns handling of the THEN recession than they have on THIS governments handling of THIS recession now.
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Nil desperandum!
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All the global leaders need to get round a table and thrash out a plan at highest priority !!!!! Seems just a news story that has now rolled on for years ! Ireland to Greece to Italy back to greece, more Greece - Ireland voting - Spain in meltdown ! The whole game needs a rethink - yields on German US bonds are now crazy - epsc compared to Spain/Italy etc If you ask me its just a ploy to the super rich can do some fancy footwork and move their money around - IE Greek billionaires moveing all there ill gotten - non-tax paid cash - completely out of Greece - its a farce. India and China are not going to save anyone. Massive QE is bout all Europe can do now !!! Then lend all the dosh to the in-debted at viable rates ! The Germans have been trying to stop this - but so far are NOT offering any real plan ! if the PIIGs cant inflate themselves out this issue - then the entire EuroZone will have MASSIVE inflation soon !!! Bond bubble I think in Deutchland !!!!
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Gold is up nearly 4% as I write. What this tells you is that the markets are expecting Central Bankers to PRINT PRINT PRINT in a vain attempt to avert economic collapse. That means inflation folks.....and lots of it.
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I agree with you Steven, Kirkfieldbank. There is a generation coming through now that began paying university fees, having far larger student debts than those who went before, can't afford to buy due to high house prices and now face job uncertainty, high inflation and poor savings rates.
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China is going down the drain because the West is floating belly up. There is no hope at all for the Eurozone and the USA is stagnant. Face it we are in for many years of STAGFLATION and ZERO GROWTH. Interest rates are at the lowest they can be. Banks are stuffed with debt so can't risk lending.........and Germany's answer in Europe is more austerity for the Eurozone. Not today not tomorrow but soon it will be a recipe for either a form of Communism or Fascism.
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depression has already come to many countries and we wont miss it either, we're about to go through at least 10 years of hell, thing that bothers me most is i wasnt old enough to benefit from the good times but im one of those wo will suffer most n the bad
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Didn't worry the punter who placed £10,000 each way on the winner of this afternoon's Oaks at 25-1. Looking at the faces amongst all those rich owners and trainers, it didn't seem to be bothering any of them either. The rich will always get richer no matter the financial circumstances of the country. But good luck to them...just wish I could get amongst them.
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