The stock market staged a partial rally today after yesterday’s Black Monday plunge.
The FTSE 100 Index of leading British companies rose 218.51 points, 3.81 per cent, to stand at 6184.28 by mid-morning in far calmer trading conditions.
However, some market commentators said they feared the recovery could prove to be a “dead cat bounce” — City jargon for a brief uptick in share prices before another fall. It has been estimated that about £2.8 trillion was wiped off share values around the world in yesterday’s spectacular rout, triggered by coronavirus panic and the escalation of an oil trade war between Russia and Saudi Arabia.
London’s blue-chip benchmark lost almost 500 points in its fifth-worst session ever, closing at a four-year low of 5,965.77.
Jasper Lawler, of online trading platform London Capital Group, said: “There will be investors waking up today wondering if it was all a bad dream. Oil fell by the most since the Gulf War and global stock markets had their worst day since the 2008 crisis.”
Neil Wilson, chief market analyst at markets.com, said: “Investors are licking wounds and there is a stabilisation of the rout but this looks like a short-term bounce on oversold levels, not a meaningful turn.”
Today fashion retailer French Connection became the latest business to issue a warning about the impact of an epidemic.
Announcing a loss of £2.9 million, the company said “a major concern is that the outbreak leads to further reductions in footfall on the High Street”. Chairman and CEO Stephen Marks added that “the trading landscape in the UK is unlikely to improve in the short term”.
However, in rare good news for consumers, Asda became the first major fuel retailer to respond to the falling global oil market with a 2p cut in the price of petrol and diesel.
RAC fuel spokesman Simon Williams said: “After such a sharp drop in the price of oil it’s right that pump prices start falling and quickly. We hope
other retailers, large and small, follow Asda’s lead.”
