Global stocks hit two-year lows as fears of worldwide recessions grow

Global stocks hit two-year lows, markets sank into bear territories, and the pound plunged to a more than 35-year low against the dollar on Friday.

Dublin

Euronext Dublin finished the day down 2.7 per cent following big sell-offs across the board on Friday. The only standout performers were the banks as AIB and Bank of Ireland finished the day down 2.5 per cent and just under 1 per cent respectively.

“It was a tough day for the market,” said one trader. “Ireland was like every other market really. Everything was under a bit of pressure. There were big sell-offs across the board. Nearly every name is red.”

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Among the construction names, building materials group CRH was down 3 per cent, while insulation specialist Kingspan was down 2.5 per cent. Housebuilder Cairn Homes ended the day down 6 per cent.

Dalata — the biggest hotel operator in the State — was down 3 per cent, while Ryanair was down 4 per cent on a bad day for the hospitality and travel sector.

Among the other big names on the index, packaging company Smurfit Kappa was down 4 per cent, while Paddy Power Betfair parent Flutter Entertainment ended the day down 2 per cent. Among the food names, Kerry Group and Greencore were both down 2 per cent.

London

The pound and London stock market plunged in what one analyst called “the worst day I have ever seen” after the Tory government revealed its mini-budget. Sterling repeatedly fell to new 37-year lows against the dollar during the day, slowly edging towards its all-time low. At its lowest point on Friday afternoon £1 could buy just 1.0896 dollars — the worst exchange rate for Britons since 1985.

London’s top index fell below the 7,000-point mark for the first time since mid-June. At its trough, the index was trading down 2.5 per cent at its lowest since March when the market had plummeted after a nuclear power plant caught fire in Ukraine.

By the end of the day, the FTSE had closed down 2 per cent. The FTSE 250 and FTSE All Share indexes also both closed down 2 per cent.

The biggest fallers on the FTSE 100 were JD Sports, down 7.55p to 105.9p, Harbour Energy, down 29.5p to 452.6p, NatWest Group, down 16p to 242.4p, Anglo American, down 169p to 2,670p, and Land Securities, down 34p to 535.8p.

Europe

The Stoxx 600 Index slumped into a bear market as fears of a looming recession hammered demand for risk assets.

The index sank 2.3 per cent on the day, to its lowest level since December 2020. Total declines from a January record high are now 21 per cent, confirming a technical bear market.

The German Dax index dropped 2 per cent, and the Cac 40 in Paris was down 2.3 per cent.

Energy and miners led the sell-off in Europe as commodities slumped on reduced demand concerns as global rate hikes weigh on economic growth. More defensive sectors like food and healthcare outperformed, while cyclicals slumped.

New York

Wall Street opened to a sea of red as US business activity contracted for a third straight month in September.

The Dow Jones was down more than 20 per cent from its January 4th record closing high, putting it on track to confirm a bear market at the close. The S&P 500 was down 2.21 per cent, and the Nasdaq Composite was down 2.2 per cent.

Technology and growth stocks slid with megacap names including Alphabet, Apple, Amazon.com, Microsoft, and Tesla all down more than 1 per cent.

All the 11 major S&P sectors declined in early trading, led by a 5.6 per cent drop in energy shares. Banks fell 1.6 per cent.

Costco Wholesale shed 2.4 per cent after the big-box retailer reported a fall in its fourth-quarter profit margins. (Additional reporting: Agencies)