More than £160bn wiped off FTSE 100 in worst fall for 33 years
12 March 2020, 18:04
The top flight plummeted 10.9%, or 639.04 points, to 5237.48, marking its biggest fall since October 20 1987.
London’s FTSE 100 Index has suffered its biggest one-day fall since 1987 with more than £160 billion wiped off the value of blue chip stocks amid Covid-19 carnage on global markets.
The top flight plummeted 10.9%, or 639.04 points, to 5237.48, marking its biggest fall since October 20 1987, the day after Black Monday.
The drop also took the FTSE 100 down to its lowest level since 2011.
It came amid a market meltdown worldwide, with indices tumbling across Europe and in America after US President Donald Trump suspended travel from most of Europe to America and as the World Health Organisation upgraded the coronavirus outbreak to a pandemic.
Across Europe, the Stoxx Europe 600, German’s Dax and the Cac 40 in France suffered their biggest ever one-day losses, with the latter two down 12% each.
On Wall Street, the Dow Jones Industrial Average was 8% lower around the time of close in London.
The European Central Bank failed to calm the market turmoil as it announced measures to tackle Covid-19’s impact on the economy, but did not cut interest rates.
Connor Campbell, financial analyst at Spreadex, branded it a “horrorshow” open on Wall Street to compound a dire session already.
David Madden, market analyst at CMC Markets, branded it “madness in the markets”.
He said: “It has been yet another horrendous day in the markets as fears surrounding the health crisis continue to rise.
“Trump’s travel ban set the scene, and even though the European Central Bank (ECB) announced measures to assist the eurozone, dealers remained in selling mode.”
Investors were left disappointed after the ECB failed to cut its deposit rate, though it launched a package including unleashing another up to another 120 billion euros (£107 billion) of quantitative easing.
In currency markets, the pound also came under pressure, slumping 1.8% to 1.26 US dollars and 0.9% to 1.13 euros.
Travel related stocks and airlines were not surprisingly among the worst impacted in the equity free-fall, following Mr Trump’s travel ban.
And Carnival tumbled 18%, down 277.5p to 1289p, after its Princess Cruises arm announced it was to cancel trips as coronavirus continues to spread.
Princess, which had two ships affected by the virus, said it was cancelling all trips for its 18 vessels for the next two months.
Sir Richard Branson also announced that the inaugural season of his new Virgin Voyages cruise line was also being postponed.
The first Briton to die after being diagnosed with Covid-19 was a passenger on the Diamond Princess, one of the Princess Cruises fleet.
Tour operator Tui was 17% lower, down 79.7p at 385.2p, while British Airways owner International Airlines Group dropped 16% or 62.8p to 334.1p and easyJet was off 14% or 125.8p to 799.2p.
Miners and financial stocks also fared badly, with the day’s declines led by Anglo American with a 19% decline, down 286.8p to 1234.4p.
Legal & General and Prudential were also high up on the biggest casualty list as investors fretted over the cost implications for insurers of the pandemic, plunging 37.7p to 182.9p and 177.2p to 884.8p respectively.
The biggest FTSE fallers were Anglo America down 286.8p to 1234.4p, Evraz off 43.9p to 203.4p, Centrica 9.4p weaker at 43.6p and Carnival down 277.5p to 1289.
There were no risers.