Monday blues turn markets red
Monday, 5 August: It was a rough day for markets, as trade fears that were prompted largely from Trump’s keyboard took a firm grip on investors. The announcement from Friday signalling the US would apply tariffs to more Chinese goods (effectively the remaining things not already caught up in the trade war) prompted investors into a risk-off mode. The move will likely be followed by a similar move from China but given the levels markets have been at recently and the reminder of the fragility of them, especially given numerous geo-political hazards that can literally spring out of Twitter, it seems many are consolidating some gains. Asian markets opened this morning with significant drops and European bourses followed suit. As Wall Street opened they also saw chunky losses, as safe-havens became more favourable than Pimms at Wimbledon. Out of the 100 companies on the FTSE, 98 were in the red. With precious metals miner Fresnillo bucking the trend to climb over 6% on the day, due to of course the flock towards asset classes like gold. It was a similar story on the FTSE 250, where Acacia Mining were the biggest climbers on the day. They also have mining activities related to, you guessed it, gold. There was some companies news on the day, of course overshadowed by the broad sell-off.
Easyhotel shares rocketed 33.33% after they agreed a £138.7m offer from Citrus UK Bidco. HSBC announced they would be cutting jobs after the surprise oust of their CEO John Flint, shares in the bank dropped 3% during the session. Tesco later announced they would also be cutting jobs from their Metro stores, amid further efforts to improve their customer offering and kick-on from their recent resurgence. There will be around 4,500 job losses, with Tesco boss Jason Tarry explaining that the format of the stores don’t suit how the majority of customers shop, with most people buying for the same day rather than using the stores for bigger weekly shops. Shares in the UK’s largest supermarket dropped 1.6% today, fairly modest in comparison to others.
The closing bell couldn’t come soon enough, the FTSE falling 2.47% to 7,223. As we write the NASDAQ is 2.6% lower, oil has shed 3%, the Dow is over 2% lower and European markets have closed with similarly big losses to begin the week. As we leave until tomorrow, all we can hope is Trump is kinder with his 280 characters overnight.