The FTSE-100 appears to be doing a fine job of proving something about Sir Isaac Newton’s law of gravity, plummeting 85 points in the first few minutes of trade and unwinding the vast majority of yesterday’s oil-inspired gains.
By Tony Cross, Monk Communications, 30th September 2016
German-based banking woes appear to be driving the market right now – Deutsche Bank’s share price closed close to 30 year lows last night and have already dropped another 7%, and the risk of contagion right across the sector certainly isn’t being ignored. Barclays and RBS are the two worst performers in early trade, with the rest of the sector not all that far behind – although the relative outperformance by HSBC is worth noting given the company’s hefty weighting on the index.
Investors are really embracing a risk off mindset this morning – the only stock managing to make headway is precious metals miner Randgold Resources, with even the defensive plays failing to find much love. There’s talk of a significant rerating being necessary in the market as we toy with these new levels, meaning this could literally be the tip of the iceberg. September has form for being a cruel month for the markets – we may have dodged a bullet this year, but October is looking far from calm.