Home Business NewsBusiness FTSE 100 claws back most of its 2022 losses and Evergrande’s shares suspended

FTSE 100 claws back most of its 2022 losses and Evergrande’s shares suspended

by LLB Reporter
21st Mar 22 9:50 am

After bouncing back last week, the FTSE 100 is now within a whisker of clawing back all the losses incurred year to date.

This resilient performance has helped to put the UK back on the map for overseas investors looking to diversify their holdings.

“To put its performance into context, the FTSE 100’s 0.9% decline so far in 2022 compares to a 10% drop in Germany’s DAX index, a near-9% fall in Hong Kong’s Hang Seng index and a 7% drop in the US S&P 500 index,” says Russ Mould, investment director at AJ Bell.

“The new trading week saw the FTSE 100 rise 0.5% thanks to strength in commodity producers. BP and Shell were among the top risers as oil prices continued to creep back up. Brent Crude traded 4.2% higher at $112 per barrel, dashing all hopes of businesses and consumers that this key driver of inflation was losing momentum.

“The big fall in the oil price between 9 and 16 March may have turned out to be a false dawn in terms of energy costs retreating.

“Shares in Evergrande were suspended from dealing, pending an announcement by the troubled Chinese property developer. The business has been struggling to services its debts and investors will be eager to know why trading in the shares has been halted.

“The market has been worried for some time that a collapse in Evergrande could cause ripple effects across the Chinese real estate and financial markets, and potentially lead to reduced commodities demand from the Asian superpower.

“Last week saw Beijing pledge to support financial markets and its fragile real estate sector. So far, the government seems to have been reluctant to bail out Evergrande, but it won’t want to suffer any embarrassment if the company does cause widespread financial and economic problems.”

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