Markets fell sharply again today after gloomy data from China ignited fresh fears over the strength of the world’s second biggest economy.
London’s FTSE 100 Index sank 133.3 points or 2.1% lower to 6114.7 after heavy falls in Asian markets following a Chinese manufacturing report showing activity fell to a three-year low last month in another sign of slower-than-expected growth in China’s economy.
The Dax in Germany and France’s Cac 40 were also sharply lower, down around 2% each.
The latest falls come after a dire August for global equities, with the FTSE and Standard & Poor’s 500 index on Wall Street both suffering their worst month since May 2012.
Trading in London was paused yesterday for the bank holiday break, but the Dow Jones Industrial Average in the US finished the month on Monday with a 0.7% fall after yet another difficult session.
The pound was also hit, falling a cent against the euro, at 1.36, after data revealed that employment in the manufacturing sector fell for the first time in more than two years last month as the sector was held back by sustained export weakness.
Sterling was flat against the US dollar, at just over 1.53.
In London, miners were the biggest fallers as the Chinese manufacturing report showed a contraction in the sector, signalling slowing demand for commodities.
Glencore dropped 5% or 7.4p to 141p.
Elsewhere, cast iron cooker maker Aga Rangemaster surged by more than 11% or 20.8p to 204p after revealing that US appliances giant Whirlpool was considering a takeover offer to rival Middleby’s £129 million deal.
In another takeover saga, online gambling firm 888 Holdings raised the stakes in its £1bn takeover battle with GVC Holdings by sweetening its bid for FoxyBingo owner Bwin.party.
Bwin said it has received a revised proposal from Gibraltar-based rival 888 and will consider it alongside a new offer made last week by GVC in a two-way bidding war that has swung back and forth since May.
Bwin did not disclose the terms of 888’s fresh approach, although Bwin said it came with “a number of pre-conditions”.
Bwin lifted 0.4p to 116.6p, 888 Holdings rose 0.8p to 163.5p and GVC holdings was 3.5p higher at 451.6p.
Pub group Punch Taverns said it is set to post a slight fall in annual earnings as it continues to offload pubs to cut its debt pile.
The firm, based in Burton-upon-Trent, said in an update it expects to report underlying earnings of between £193 million and £200 million in the year to August 22 in line with expectations, compared with £205 million the previous year.
Shares slipped 1.5p to 123.5p.