It comes as Asian shares fell on Friday after worrying Chinese economic data was released. Stocks faltered as worries about a delay in US fiscal stimulus discouraged some investors from taking on risk. MSCI’s broadest index of Asia-Pacific shares outside Japan fell 0.24%, although shares in Japan rose 0.07%.
South Korean stocks fell 1.27% after authorities reported the largest number of new coronavirus cases since March.
Chinese shares erased early gains and fell 0.1% as a slower-than-expected rise in industrial production and a surprise fall in retail sales weighed on investor sentiment.
Further equity gains are likely to be limited as investors await progress in negotiations over US economic stimulus.
The mood was cautious in Asia after Chinese retail sales unexpectedly fell in July, suggesting domestic demand is still struggling after the coronavirus outbreak.
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12:30pm update: Pound holds steady despite morning market chaos
Sterling is trading flat at $1.3067 and at 90.35 pence against the euro.
It has risen nearly 7% in the last three months against the U.S. dollar, almost exclusively on the back of the greenback weakening.
“It’s summer markets, nothing is going to happen, it’s all about the bond market at the moment,” said Kenneth Broux, head of corporate research at Societe Generale.
11.30am update: FTSE stabilises after chaotic morning
After plunging from 6,185 to 6,038 in barely two hours this morning, the FTSE has stabilised.
The index has halted in dramatic drop and risen slightly to 6,056.
10.30am update: Bleak morning for EU markets
Like the FTSE, European markets are also struggling this morning.
Euronext 100, CAC 40, DAX and the Swiss Market Index are all substantially down.
Euronext is down 2.12%, CAC 2.23%, DAX 1.35% and Swiss Market 1.49%.
FTSE is now down 2.30%.
9.00am update: FTSE plunge continues
The FTSE’s dire morning has continued with a second precipitous drop in just an hour of trading.
The index had looked to have stabalised after falling from 6,185 to 6,131 in just 20 minutes this morning.
However after a brief uptick, FTSE has now fallen further still to 6,085.
This marks a loss of 1.61% in just an hour.
8.10am update: FTSE opens down
Like yesterday, the FTSE 100 has started the day on a negative note, falling over 50 points on open.
After closing at 6,185 yesterday, the index has now fallen to 6,131.
This marks a loss of 0.87% in just 10 minutes.
More to follow…