Published By : 31 Aug 2015 | Published By : QYRESEARCH
FTSE 100 is at its worst monthly losses in China since May 2012. The pan-European FTSEurofirst 300 dropped 10% in August. There were growing concerns over the global economy as well as China’s global growth. The London’s share index lost 6.7% during the same period.
The economic headwinds regarding the global stock markets have shaken the global concerns over the second largest economy.
Various investors in emerging market currencies, shares, and commodities fright the moves by the Chinese authorities and their hint at the slowing growth in the country.
Among some of the Beijing’s moves, the biggest setback was witnessed from a dramatic devaluation of the yuan in the attempt to shore up the flagging exports.
The FTSE has posted an excellent weekly performance after the clawed back losses were incurred in the light of Black Monday. China’s top share index took the world’s leading indices and plummeted across the globe.
Since the depths of the financial crisis across the globe, the FTSE closed up 0.9% at 6247.94. This value was above the 6188 level but wasn’t enough to head off the worst monthly performance in more than three years.
The index tumbled 4.7% in the start of this week due to concrete signs of economic weakness. This declined the Shanghai Composite Index by almost 9% to dub the sell-off Black Monday, said a leading China’s new agency.
However, the index lost almost 8% over the week. For other stocks outside China, optimism and emergency measures from policymakers are expected to power the recovery. According to the forecasts, European shares are expected to recoup their losses and Wall Street by 1%, by end of this week.
Amid the turmoil, there is a silver lining for investors to push back the expectations of interest rates in the UK and the US. These rates might finally begin to rise after years at record lows.
The CNBC broadcaster asked for the September rate hike and how it was less compelling after the recent market volatility. According to one trader in London, there is a breather after a crazy week and this has been a case of fast money in thin markets.
On Thursday, oil prices had their biggest one-day setback, with US light crude and North Sea Brent increasing by more than 10%. The US crude is on track based on the first weekly gain in nine weeks, ever since its longest decline 1986.
The oil markets across the globe have fallen by third since May and are still well under half their value a year ago.