London’s FTSE 100 markets slumped into the red on Monday, having opened slightly higher, as disappointing PMI data sparked a sell-off.
The capital’s premier bluechip index dropped 1.28 per cent to finish at 7,510.72 while the mid-cap FTSE 250 fell 1.65 per cent to 17,977.29.
Markets opened the day slightly higher after the news that the US government had managed to avoid a shutdown. However, sentiment soured after new figures showed the slump in global manufacturing was continuing.
In the UK new data showed that the manufacturing sector remained mired in downturn. According to the Chartered Institute of Procurement & Supply (CIPS) the UK manufacturing purchasing managers index (PMI) recorded 44.3 in September.
Although September’s reading was stronger than the 43.0 recorded in August, it was still among the weakest readings seen in the last 14 years.
“Demand was impacted negatively by ongoing market uncertainty, the cost-of-living crisis and weak conditions in overseas markets,” the survey said.
In the eurozone, September’s PMI remained deeply in contraction at 43.4 while activity improved in the US, but remained in the red.
On the FTSE BAE Systems climbed 1.0 per cent after it was awarded a £3.95bn contract to build a new generation of submarines as part of the Aukus defence pact.
Only a handful of other firms were in the green, including United Utilities as investors were optimistic about plans to invest billions to improve the UK’s creaking water infrastructure.
A slew of firms on the FTSE were caught up in the sell-off this afternoon, with Beazley falling 4.2 per cent, SSE 3.4 per cent and Prudential 3.3 per cent.