London’s blue-chip stocks tumbled after lunch to end the day significantly lower as US stocks joined in today’s global markets sell-off.
Across the pond, The Dow is nursed a triple-digit fall after US inflation figures suggested the climate is right for an interest rate rise.
July’s Consumer Price Index rose a seasonally adjusted 0.1%, the sixth month in a row the index has risen.
A higher interest rate is one of the tools used to keep inflation in check, and pundits suggested the reading made a September rate rise more likely.
Meanwhile, big falls by Asian markets overnight continued to weigh on global markets.
Denis de Jong, managing director of forex trading firm UFX.com. “It seems as though growth in China isn’t as strong as we thought which is a very real concern for the health of the global economy.”
Markets across Europe struggled with the Dax easing 2.1% to 10,685 while the French Cac40 lost 1.7% to 4,887.
The FTSE 100, which had been outperforming its European counterparts for much of the day, dropped further in the afternoon to end 1.8% lower at 6,408.
Nestled at the bottom of the index was Glencore (LON:GLEN) which reported its interim results today.
The shares fell 7% to 163p as the miner and commodity trader blamed the sharp fall in commodity prices for lower profits and said it would cap spending at US$5bn in 2016.
In other mining news, KAZ Minerals (LON:KAZ) was trading higher as the gold price improved, and as shares regained some of the ground lost in recent days.
Interim results are to be released tomorrow and shares rose 6.5% to 155p today.
At the other end of the index, insurer Admiral (LON:ADM) reduced losses in the international business boosted by Conte, its Italian business, which made its first profit.
In the UK, car insurance profit rose 6% while, overall, the firm stated that it had more than 4mln members in the first half. Shares rose 3.9% to 1,523p.
In small caps, Sunrise Resources (LON:SRES) said it will kick-off drilling at its Bay State silver project in Nevada next week. It signed a deal with Boart Longyear to undertake the work.
One drill hole will specifically target an area which recently yielded “bonanza silver grades” in underground sampling. Shares were 35% higher at 0.29p.
Elsewhere, Insurance broker and consultant Jelf (LON:JLF) confirmed it may be the subject of a takeover by global firm Marsh Ltd. Shares surged 11.59% to stand at 231p as the market welcomed the news.