A large drop at the start of the week has provided a cause for concern amongst investors with the FTSE 100 lower by almost 100 points on the day. The declines were evident in the futures markets after the cash close on Friday as global stocks swooned as volatility, absent for large swathes of last year, made a stunning comeback. The Pound is also lower on the day and with growing murmurings of political instability there could be further downside ahead for Sterling.
Investors rattled as stocks take a tumble
It was all looking so good for UK stocks just over a fortnight ago with new all-time highs an almost daily occurrence. The speed at which the outlook has deteriorated can be described as somewhat alarming with a decline that began with currency effects due to an appreciation of the Pound has blown into a pretty large scale sell-off as equities around the globe have been hit with a wave of selling leaving the benchmark more than 5% off its peak seen in mid-January. Investors will hope that this drop finds the requisite buying support to halt its decline with any significant further downside threatening to derail the rally that began in the days following the Brexit vote back in the summer of 2016.
Few brights spots in broad-based sell-off
A further worrying sign for stock market bulls is the breadth of the market’s decline with only a handful of blue-chips managing to rise on the day. Kingfisher (LON:KGF) and Anglo American (LON:AAL) are the two best performers with the former higher by almost 2% and the latter just shy of 1%, but aside from this duo there is little by the way of any notable gainers. At the other end of the index is Old Mutual, which heads a list of sizable fallers with Rolls Royce (LON:RR) and Vodafone (LON:VOD) not far behind.