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FTSE plunges after US jobs data

posted : MONDAY, 5TH OCTOBER 2009 04:07:59 BST comments : 0

filed under : EMPLOYMENT
- Search: London Stock Exchange

The FTSE 100 Index up 42.6 points to 4590.1 in mid-morning trading
The FTSE 100 Index up 42.6 points to 4590.1 in mid-morning trading

Shock US jobs data sent the London market diving into the red as gloom gathered over trading floors.

America's June jobless figures brought an end to a run of five straight months of improvements, dampening hopes that the world's largest economy was poised for a strong recovery soon.

The FTSE 100 Index slumped more than 2% to close down 106.4 points at 4234.3 as early falls were compounded by the grim news from across the Atlantic.

Its falls were mirrored on Wall Street as the Dow Jones Industrial Average slumped 2%.

US June non-farm payroll figures revealed the economy shed 467,000 jobs in June, nearly 100,000 more than anticipated, and substantially more than the 322,000 decline in May.

Meanwhile the unemployment rate did not rise as much as expected, but still hit a 26-year high of 9.5%.

A report on unemployment in the 16 countries that use the euro also hit sentiment after it showed a hike to its highest level in 10 years.

Concerns over the US and European figures sent oil prices tumbling to their lowest level in a month, with a 3% slump to 66 US dollars a barrel. BP fell 9.05p to 480.95p, while in the mining sector Anglo American dropped 106.5p to 1726p while Rio Tinto eased 123p to 2035p.

In a day in which just four firms ended on the risers board, drinks firm Diageo topped the leaders with an 8p rise to 905p.

Diageo on Wednesday announced 900 job losses in Scotland as part of ongoing cost cutting. Fellow drinks firm SAB Miller fell back after earlier gains, losing 20p to 1260p as it said it was considering selling a stake in its South African business to black investors.

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