block-time published-time 8.35am GMT
Today’s selloff comes nearly a week after global markets slumped into bear market territory, triggering alarm around the world:
enltrGoogle searches for "bear market" the highest since October 2008: pic.twitter.com/gOmjtBzfVi
— Jamie McGeever (@ReutersJamie) January 26, 2016
block-time published-time 8.30am GMT
Simon Smith, chief economist at currency trading firm FXPro, fears that more market turbulence is coming.
He writes:
Chinese indices are 6% lower overnight, Japanese over 2% in the red and oil is back below 30 bucks a barrel.
Volatility has been rising throughout the year so far but we’re still someway off the big spike in the Vix (volatility index or ‘fear gauge’) last August and so there’s potential for moves in markets to get even more dramatic.
block-time published-time 8.26am GMT
Today’s selloff has been triggered by the slide in the oil price, as well as the Chinese market mayhem.
Tony Cross of Trustnet Direct explains:
Crude is sliding on renewed oversupply fears and even the building narrative we’re seeing from Opec that they are ready to strike a deal with other producer nations – possibly centred around
Russia
– doesn’t really appear to be lending any support to the equation, at least not yet.
block-time published-time 8.13am GMT
The gold price has jumped by 1%, as money pours out of shares and into safe-haven assets.
That’s usually a sign that investors are worried.
enltrAnd... gold prices are closer to $1,120/ounce. #SellOffpic.twitter.com/GmiYBnQF64
— David Ingles (@DavidInglesTV) January 26, 2016
block-time updated-timeUpdated at 8.17am GMT
block-time published-time 8.11am GMT
Other European markets are also falling, with France’s CAC down 1.6% and the German DAX shedding 1.3%:
enltrSiemens - only stock in the #Dax trading higher today after reporting higher profit. Shares jump 4%. #Ingenuity JG pic.twitter.com/Crla8ijI68
— IGSquawk (@IGSquawk) January 26, 2016
block-time published-time 8.04am GMT
FTSE 100 falls 1.5% at the start of trading.
The FTSE 100 index of major
UK
companies has fallen by 87 points at the start of trading, or 1.4%, to 5789
Almost every share is falling, as traders face another day of volatile trading dominated by fears over the global economy.
BP and Royal Dutch Shell are both down around 3%, mirroring today’s sliding oil price.
Mining companies are also suffering, reflecting worries about
China
. Commodity trader Glencore has shed 3.5%, and Anglo American (which produces iron ore, copper, nickel etc) is down 3.2%
block-time published-time 7.53am GMT
Almost every share on the Chinese stock market was hit by today’s rout, with only four gaining ground.
The CSI 300 today Photograph: Thomson Reuters
block-time updated-timeUpdated at 7.57am GMT
block-time published-time 7.40am GMT
Chinese stock markets slumps 6% to 13 month low
A late wave of selling has gripped the
Shanghai
stock market, sending shares slumping and triggering new angst in financial markets worldwide.
China’s benchmark index, the CSI 300, shed 188 points or 6.02% to finish the day at 2940. That’s its lowest level since December 2014.
The CSI 300 over the last 2 y8ears Photograph: Thomson Reuters
Scores of shares were suspended after falling 10%, the maximum allowed under Chinese stock market regulations.
The
Shanghai
market tumbled by 6.4%, the biggest daily loss since the first week of 2015.
enltr*
SHANGHAI
COMPOSITE PLUNGES 6.4% AT CLOSE, MOST SINCE JAN. 7— lemasabachthani (@lemasabachthani) January 26, 2016
The selloff, which helped to drive oil down, came after new economic data showed that China’s rail freight volume dropped by 11.9% last year, compared to 2014.
That fuelled fears that China’s economy is slowing faster than official figures show.
frltr #China | 2015 rail frieght volume 3.36B tonnes, -11.9% y/y: NDRC pic.twitter.com/2DSlq3MruG
— Ioan Smith (@moved_average) January 26, 2016
block-time published-time 7.28am GMT
Oil drops back through $30
The crude oil price has lurched back through $30 per barrel.
Brent crude has slumped by 3% this morning, and is changing hands at $29.61 per barrel.
enltrOil drops below $30 again https://t.co/b9WN3qN4bxpic.twitter.com/iTsZtt1Xlk
— Bloomberg Business (@business) January 26, 2016
The selloff is partly being driven by oversupply fears, with OPEC members sticking to their guns and keeping pumping in an apparent attempt to drive other suppliers out of business.
Kit Juckes of French bank Société Générale says the weak oil price will add to the gloomy mood in the markets:
The fall in oil prices will make most of the headlines and drive most of the movement in markets today, unless it is reversed for no particularly good reason. The latest driver is the news that Iraqi oil output is strong. US production remains the key swing on supply and is what will eventually trigger a turn. But it will take hard news about declining US output to shift the market mood.
block-time published-time 7.07am GMT
Introduction: Losses expected in
Europe
after Asian falls
Good morning, and welcome to our rolling coverage of the world economy, the financial markets, the eurozone and business.
It looks like being another ‘challenging’ day in the markets.
Asia’s two-day rally has hit the wall, with most markets falling.
Japan’s Nikkei just closed down 2.4%, and we’re expecting European stock markets to fall at the open (8an GMT).
The surge of optimism which pushed shares higher at the end of last week has dissolved, in the face of worries about deflation and economic slowdown.
enltrLast weeks rally a distant memory. Nikkei ends down 2.4% at 16708.90 while Yen strengthens beyond 118 per Dollar. pic.twitter.com/R3Tyu58GTU
— Holger Zschaepitz (@Schuldensuehner) January 26, 2016
enltrOur European opening calls: $FTSE 5814 down 63 $DAX 9627 down 110 $CAC 4261 down 51 $IBEX 8475 down 93 $MIB 18448 down 193
— IGSquawk (@IGSquawk) January 26, 2016
In the corporate sector, budget airline easyJet and high street tech chain Dixons Carphone are releasing results.
Mark Carney, Governor of the Bank of
England
, is testifying to MPs this morning about the BoE’s financial stability report, from 10am GMT.
And we’ll have an eye on
Greece
, where unions are expected to hold a protest rally in
Athens
today against pension cuts. That comes as
We’ll be tracking all the main events through the day....
block-time updated-timeUpdated at 7.13am GMT
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