Oil and euro drive FTSE down again


Published: Tuesday 6th January 2015 by The News Editor

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The FTSE 100 Index headed lower for a third session in a row today in a slump driven by sliding oil prices and fears of a Greek exit from the euro.

London’s leading share index had lost 2%, or 130.6 points, in the previous session and was again lower, by about 0.8%, to 6366, as the markets showed little sign of sparking into life after a dismal start so far to 2015.

The FTSE 100 is now nearly 200 points lower than where it ended 2014.

Oil again fell, with the price of a barrel of Brent crude slipping towards 52 US dollars to a new near-six year low. It was last lower in May 2009 and has fallen from 115 US dollars in June.

The slump is feeding through to motorists, with all four supermarkets having just announced the latest 2p cut in the cost of a litre of petrol as it heads towards £1.

Meanwhile the euro, which hit a nine-year low against the US dollar at the start of the week, failed to recover much ground today, edging marginally higher.

It was also up a little against the pound, but with sterling trading at just under 1.28 euros, it is still close to six-year highs against the single currency, boosting spending power for UK holidaymakers on the continent.

The FTSE’s performance comes after Wall Street shares plunged, dropping 1.9%, while Asian stocks were also lower overnight.

James Hughes, chief market analyst at Alpari UK, said: “With the new year has come the same old problems for global financial markets, with the supply glut and weaker demand for oil causing tumbling prices.

“Europe is the other major talking point in global markets yet again this week and it feels like we have moved full circle on the eurozone crisis as markets are yet again dominated by a potential exit from the euro area by Greece.”

BP shares, which account for a slice of many UK pension funds, had lost 5% in the previous session and were again lower today.

FTSE 100-listed exploration firm Tullow Oil, which lost half its value in 2014 amid the oil price plunge, was down again, by 2%.

Published: Tuesday 6th January 2015 by The News Editor

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