FTSE plunges on US jobs data
Shock US jobs data sent the London market diving into the red today as gloom gathered over trading floors.
America’s June jobless figures brought an end to a run of five straight months of improvements, dampening hopes that the world’s largest economy was poised for a strong recovery soon.
The FTSE 100 Index slumped more than 2% to close down 106.4 points at 4234.3 as early falls were compounded by the grim news from across the Atlantic.
Its falls were mirrored on Wall Street as the Dow Jones Industrial Average slumped 2%.
US June non-farm payroll figures revealed the economy shed 467,000 jobs in June, nearly 100,000 more than anticipated, and substantially more than the 322,000 decline in May.
Meanwhile the unemployment rate did not rise as much as expected, but still hit a 26-year high of 9.5%.
A report on unemployment in the 16 countries that use the euro also hit sentiment after it showed a hike to its highest level in 10 years.
Concerns over the US and European figures sent oil prices tumbling to their lowest level in a month, with a 3% slump to $66 a barrel.
BP fell 9.05p to 480.95p, while in the mining sector Anglo American dropped 106.5p to 1726p while Rio Tinto eased 123p to 2035p.
In a day in which just four firms ended on the risers board, drinks firm Diageo topped the leaders with an 8p rise to 905p.
Diageo yesterday announced 900 job losses in Scotland as part of ongoing cost cutting.
Fellow drinks firm SAB Miller fell back after earlier gains, losing 20p to 1260p as it said it was considering selling a stake in its South African business to black investors.
Mobile phone giant Vodafone lost 4p to 115.5p after it buried the hatchet with Carphone Warehouse and agreed to sell its contract mobiles across the chain’s outlets.
The firm dumped the chain as a supplier of contract mobiles in favour of an exclusive deal with Phones4U in October 2006, but has returned to the chain in an increasingly tough and competitive UK market.
In the FTSE 250, shares in pubs and brewing business Greene King rose almost 3% or 12.25p to 422.25p after the company said the recent warm weather had boosted trade.
A broker upgrade from Investec Securities also helped the pub group make gains.
But there was no such rise for retailer Game, which tumbled more than 13%, or 22p to 142p, after detailing lacklustre trading figures for the first half of the year.
Back in the top flight banks failed to end higher after early rises following a broker upgrade for Standard Chartered and confirmation of the formal appointment of acting chairman John Peace in the role. Shares in the bank fell 25p to 1155p.
The only Footsie risers were Diageo up 8p at 905p, Petrofac up 3.5p at 683p, Friends Provident up 0.12p at 68.09p and Admiral Group up 1p at 877.5p.
The biggest Footsie fallers were WPP down 29p at 384.5p, Anglo American down 106.5p at 1726p, Rio Tinto down 123p at 2035p and London Stock Exchange down 38.5p at 663.5p.
