Gloomy growth news prompted a stock market slide today.
The FTSE 100 has fallen over eight per cent following the news that the UK is slipping into recession. At 14:15 BST, it was down 8.29 percent on the day, with bank shares seeing some of the biggest falls.
Yesterday, London's leading share index finished the day up on expectations that Opec would move to stem the decline in oil prices by announcing cuts in production. But the gains were quickly wiped out after the Office for National Statistics revealed that Britain's economic output fell 0.5 percent between July and September.
Commenting on the volatility, Ryan Kneale, market analyst at BetsForTraders.com, said: "The general feeling is that we may be over the worst of the credit crisis, but the recession is only just beginning and this is really starting to hurt share prices now."
He said the turbulence is expected to continue over the coming months as the markets wait to hear whether the economy shrinks further between now and December, since the common definition of a recession is two periods of falling quarters of negative growth. However, he said performance should improve slightly once traders are over the initial shock of today's figures.
Stock markets in Europe, the United States and Asia also recorded large falls this morning. Frankfurt's benchmark DAX index and the Cac 40 in Paris dropped ten percent in early trading.
