FTSE 100 Falls by 3% This Week

FRIDAY MARKET UPDATE: The benchmark FTSE 100 index fell by nearly 3% this week as investors worried about the US fiscal cliff and continuing eurozone problems

Alanna Petroff 16 November, 2012 | 5:47PM

UK stocks declined for a third consecutive day on Friday, with the benchmark FTSE 100 index now closed at a low that hasn't been seen since late July. The main stock market indices in London were all in the red and closed on Friday with weekly losses ranging from 1% to 3%.

"Investors really are being truly pummelled from all angles at the moment with the fiscal cliff in the US, the eurozone debt crisis [on] this side of the Atlantic and geopolitical tensions in the Middle East starting to heighten," said Angus Campbell, head of market analysis at Capital Spreads.

"The last thing these fragile markets need right now is an escalation of the unrest in Israel and its surrounding countries as this has the potential to really get the bears baying for blood," he said.

The FTSE 100 declined by 72 points, or 1.3%, on Friday. It is now closed at 5,606. The FTSE 250 index also dropped by 107 points, or 0.9%, to close at 11,577.

Melrose (MRO) took the biggest plunge amongst the UK large-caps on Friday, with shares falling by 11.5% after the engineering company issued a statement saying that it was seeing a slowdown in business. 

"Especially in the last few weeks, slower trends for certain businesses are noticeable compared to those seen in the first half of the year," stated the company in its interim management statement

Shares in the oil giant BP (BP.) also declined by 2% on Friday after it announced that it had reached a £2.8 billion ($4.5 billion) settlement with the US Department of Justice over its Deepwater Horizon oil spill in the Gulf of Mexico. The company issued a statement saying it is pleading guilty to 14 criminal charges. Of those 14, there were 11 felony counts for misconduct and neglect related to the death of 11 of its workers on the now-infamous oil rig.

The one bright spot in the markets was IMI (IMI), which saw shares pop up by nearly 2% on Friday. The engineering group reported a surge in sales for its infrastructure projects in its latest interim management statement.

Market Performance (November 12 - 16)

FTSE 100: -2.84%
FTSE 250: -2.24%
FTSE All Share: -2.73%
FTSE Small-Cap: -1.21%
FTSE AIM 100: -2.21%
FTSE Fledgling: -1.18%

Top Reads from Morningstar

UK Banks May Soon Be Looking For Additional Capital
A Sample Retirement Portfolio for Moderate Investors
The Most Coveted Funds of 2012
Which Asset Classes Are Looking Attractive?
Europe: The Good, the Bad and the Overlooked

Find more articles and videos in our online archive and video centre.

The information contained within is for educational and informational purposes ONLY. It is not intended nor should it be considered an invitation or inducement to buy or sell a security or securities noted within nor should it be viewed as a communication intended to persuade or incite you to buy or sell security or securities noted within. Any commentary provided is the opinion of the author and should not be considered a personalised recommendation. The information contained within should not be a person's sole basis for making an investment decision. Please contact your financial professional before making an investment decision.

Securities Mentioned in Article
Security NamePriceChange (%)Morningstar
BP PLC586.30 GBX0.39
IMI PLC1,182.00 GBX1.46-
Melrose Industries PLC236.80 GBX0.98-
About Author Alanna Petroff

Alanna Petroff  is a financial journalist with Morningstar UK.