The FTSE experienced a downturn today, contributing to a pervasive sense of pessimism in London’s markets as global stock indices declined.
Worldwide stock markets slipped as investors responded to stronger-than-expected employment numbers from the United States. Official data revealed that the number of jobs added by employers in the world’s largest economy last month significantly surpassed analysts’ forecasts, indicating a robust labor market.
Richard Flax, Chief Investment Officer at Moneyfarm, commented, “The unexpectedly strong December US labor market data, with payrolls increasing by 256,000 compared to the projected 164,000, has intensified the global bond sell-off and heightened concerns about enduring inflationary pressures in the US.”
A stronger US job market implies that interest rates may remain elevated for an extended period.
In the UK, the FTSE 100 declined by 0.9%, while the FTSE 250, which includes more domestically focused companies such as Greggs and Currys, fell by 1.4%.
Across the Atlantic, Wall Street saw significant losses with the S&P 500 dropping approximately 1.7%, the Dow Jones Industrial Average down by 1.7%, and the tech-centric Nasdaq decreasing by 2%.
This somber sentiment was mirrored across European markets. In Paris, the CAC 40 closed 0.8% lower, and Frankfurt’s DAX index decreased by 0.5%.
