Yesterday's trading: Nervy traders run for the hills
Dogged by fear that in every corner of the financial world there lurks a dark secret, investors on both sides of the Pond ran for the hills.
Running for the hills: Gloomy forecasts led to sell offs on both sides of the Pond
Official confirmation that Britain went into recession at the end of last year for the first time since 1991 exerted yet more downward pressure at home, and the Footsie fell 95 points on the news to trade below 4,000. But against all odds it later rallied to close a traumatic week 0.24 points better at 4,052.47.
Wall Street slumped 213 points to below 8,000 at the outset following a batch of disappointing trading statements and worries that fourth-quarter earnings statements from major U.S. insurers next week will contain yet more hefty and unsavoury write-downs.
Credit card issuer Capital One Financial also rang alarm bells after warning that losses will worsen this year.
It believes U.S. unemployment will hit 8.7% in the coming months, up from the current 7.2%.
Poor old Barclays was on the receiving end of another hammering.
For the ninth consecutive day, it was mauled by hungry sellers amid growing concerns that it may require further capital or be nationalised by the government.
Heavily sold down to 47.6p at one stage it closed 8p, or 13.5%, lower at 51.2p. It has now lost a staggering two thirds of its value since the start of the year and is capitalised at a paltry £4.3bn.
Chief executive John Varley's comments that the bank would prefer to pay the UK government in cash, rather than shares, if it takes part in a scheme to insure risky assets, was taken with a pinch of salt by investors.
They trust him about as far as they could throw him.
Those other banks which have been in freefall since Monday's second government bailout remained in the dog-house. Lloyds Banking Group slumped to 43.2p and closed 0.2p easier at 49.3p. It has incredibly halved in value since trading as an enlarged bank with hapless HBOS now under its umbrella. Royal Bank of Scotland cheapened 0.1p more to 12.1p for a fall of 60%-plus on the week.
Up 14¾p initially amid revived speculation that China Investment Corporation, the $200bn sovereign wealth fund, is about to take a $20bn stake in the bank, HSBC was hit by late selling and ended 11½p easier at 515½p.
Spooked by HSBC's analyst comments that it is one of half a dozen major insurers which have absolute capital levels close to existing credit requirements, raising fears of capital raising or earnings downgrades, Prudential plummeted. The shares crashed to 265¼p before closing 18p off at 288½p.
Prudential rights issue rumours were rife in October. Dealers are aware that chief executive Mark Tucker is interested in acquiring the Asian assets of the troubled US insurer AIG, and a big fund raising would be necessary to help finance a deal. It would also bolster its balance sheet as the prolonged stockmarket slump has been a severe test of its capital reserves.
Legal & General, which reports fourth-quarter figures on Thursday, lost 3.4p to 55.4p. Aviva shed 19p to 264p.
Properties took a pasting on growing cash call worries. Liberty International led the retreat at 385¾p, down 54½p, while Hammerson was hammered 25¾p to 404½p and Land Securities shed 39p to 625½p. British Land lost 24½p to 430¼p.
Wolseley shed 11p to 286p after investors pulled the plug ahead of Monday's figures. They fear the plumbing group will turn on a £500bn-plus rights issue tap. Speculation that drugs giant Pfizer is about to buy Wyeth in a multi-billion dollar deal gave a shot in the arm to UK pharmaceuticals. Astra Zeneca, which is due to report fourth-quarter figures on Thursday, jumped 101p to 2881p. Industry optimists still believe that one day AZ will climb into bed with UK rival GlaxoSmithKline (15p lower at 1226p).
Satellite TV giant BSkyB declined 12¾p to 411½p ahead of Wednesday's interims. Broker UBS is a buyer and says that while it's wary of the impact of rising unemployment on churn as the year progresses, it believes Sky should remain relatively robust and will continue to outperform its TV and consumer peers.
Revived talk of a possible 125p-a-share cash bid from TNT BP lifted Ukraine-focused oil and gas explorer Regal Petroleum 4¼p more to 41¾p.
Reports of employee buying and a KBC Peel Hunt recommendation helped Speedy Hire climb 16½p to 60¼p.
Most watched Money videos
- Land Rover unveil newest all-electric Range Rover SUV
- A look inside the new Ineos Quartermaster off-road pickup truck
- BMW meets Swarovski and releases BMW i7 Crystal Headlights Iconic Glow
- MailOnline asks Lexie Limitless 5 quick fire EV road trip questions
- 'Now even better': Nissan Qashqai gets a facelift for 2024 version
- Tesla unveils new Model 3 Performance - it's the fastest ever!
- 2025 Aston Martin DBX707: More luxury but comes with a higher price
- Mini celebrates the release of brand new all-electric car Mini Aceman
- Mail Online takes a tour of Gatwick's modern EV charging station
- Leapmotor T03 is set to become Britain's cheapest EV from 2025
- Blue Whale fund manager on the best of the Magnificent 7
- Mercedes has finally unveiled its new electric G-Class
- Revealed: The investments that will really make a holiday...
- BUSINESS LIVE: Ryanair profits soar; AstraZeneca builds...
- RUTH SUNDERLAND: Stop cynical Royal Mail bid
- Cadbury owner Mondelez to face scrutiny over selling...
- Ryanair profits soar to record high of almost €2bn
- Who would qualify for a £100 Nationwide loyalty bonus...
- Britain's new bonkers EV: Callum Skye is an £80k electric...
- Australian miner looking to buy Anglo American set to...
- I was 'brokefished' by my friend for £400 - can I salvage...
- AstraZeneca to construct $1.5bn cancer drugs facility in...
- British Land sells stake in Sheffield's Meadowhall...
- Top industrialist Sir Jim Ratcliffe blames high taxes for...
- Victoria Plumbing buys arch rival Victoria Plum in £22.5m...
- Keywords Studios eyes £2.2bn takeover by Swedish private...
- Where it REALLY pays to own a holiday let - how to turn a...
- CITY WHISPERS: Boss Cook-ing up a big sparkler to woo De...
- St James's Place facing humiliating exit from FTSE 100
- Sales at Bloomsbury soar thanks to the craze for...