Tuesday 5 July 2011

FTSE 100 below where it began the year

Dealer index closed in paragraphs 5,845.29 - its more narrow low in three months - after an "unholy triumvirate" of bad news.

Chris Purdy, a trader at Spreadex, said escalating violence in Libya, a downgrade rating of credit and the weak data from the Spain China had investors for the hills running.

Richard Hunter, head of UK Equities at Hargreaves Lansdown securities broker said the market was "fighting against a sea of concern".

"There is concern that the geopolitical situation in the Middle East could derail the recovery and the risk of default of payment of European sovereign debt fears have been building in recent weeks, Mr. Hunter." investors decided of move to the bottom in gold and save currencies haven. "".

"If unrest spreads in the things of the Middle East could get seriously disturbing."

However, Mr. Hunter believed that the FTSE would end the year above 6,500 points.

Mick Gilligan, responsible for research at Killik Capital, said there there had no "wholesale" shares, but investors are enterprises ditches of natural resources for defensive stocks. »

The Libya oil production was cut to 500,000 barrels per day of 1. 6mafter a rebellion against Muammar al-Gaddafi began last month. Concerns grow similar disorders may extend to the Kingdom of Saudi Arabia, oil-rich.

Experts are also regularly saying oil prices could affect the global world economic recovery, despite signs that he spent at the course.

"We had been favour bumping our appeal of global growth." Unfortunately, the wave of oil prices cancelled more of this upgrade, "Bank of America-Merrill Lynch, said in a research report. "The risks on growth are strongly biased to the downside."

The report said that a global recession would be a real risk that the oil prices have exceeded US $150 per barrel of sustained. $ 200 Per barrel, a global recession is almost certain, he said.

The stock market rout spread to United States where the Dow Jones fell 1. 9pc to close at 11,984.61. The broader Standard & poor 500 index dropped 1. 9pc to 1,295.11. The Nasdaq composite dropped 1. 8pc to 2,701.02.

Investors were pots when China reported a trade deficit of surprise in February on Thursday. Chinese exports fell in February as businesses closed for the lunar new year day a week, but more high-priced oil and other goods imports have jumped, producing a trade deficit for the month of the summer of $7.

Decommissioning of the Moody of the debt of the Spain, most beautiful fears about Europe's debt crisis. In the United States, the Government reported that new claims for unemployment benefits rose more than expected last week.

The United States oil prices fluctuated $ 103 per barrel as traders worried about protests in Saudi Arabia could degenerate and hinder production in largest exporter of crude oil the most.

In Asia on Friday, Japanese Nikkei 225 average stock lost 1. FP7 to 10,254, ABN Korea in the South fell 1. 2pc at one stage and the Australia S & P/ASX 200 1. 1pc. Index Hang Seng Hong Kong hangar 0 FP7 to 23,443, with smaller shares of energy.

Mainland China Shanghai Composite Index slid 0. 3pc 2,949.12, after China announced that its February inflation remained high at 4 9pc. Accelerated food prices increase, adding to the pressure of the Government to control the anxieties cost of living is concerned could fuel unrest.

FTSE 100 is seen falling Friday, with an earthquake struck off the coast of the northeastern coast of the Japan likely to add another subject of concern for investors.


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