FTSE 100 index declined nearly 1% to settle at 6,735.71
Shares slid for the fourth time this week on Friday as London’s top companies gave back half the gains they made in the opening week of 2021.
The stock markets were on fire last week as traders kicked off the year with a bang, but since waking up on Monday they have been in a more sombre mood.
In the past five days of trading, London’s FTSE 100 index has lost 137 points, nearly half of everything that it gained during one of its best ever starts to a year.
On Friday, the index lost 66.25 points, a nearly 1% decrease, and settled at 6,735.71.
Investors had been eagerly anticipating the plans of incoming US President Joe Biden on Thursday, and had sent shares up on the day. But events overtook Mr Biden’s plans to send 1,400 dollar (£1,000) stimulus cheques to many Americans as part of a 1.9 trillion dollar Covid-19 stimulus plan.
Conscious of the difficulties in getting anything done in the American political system, let alone when you are trying to impeach the outgoing president, investors greeted Joe Biden’s 1.9 trillion dollar Covid-19 stimulus plan with a ‘we’ll see’, said Spreadex analyst Connor Campbell.
Unfortunately that meant attention lingered on a rough couple of days for US data. Following on from Thursday’s sky high jobless claims figure – the worst since the end of August, and perilously close to the one million mark – investors had to deal with a pair of glum December retail sales readings suggestive of a tough Christmas across the country, he said.
The UK had gloomy economic news of its own, as gross domestic product (GDP) was reported dropping 2.6% month-on-month in November, putting the economy back on track for a recession.