Less than three days in and October has made a typically grim start to Q4. Here are the biggest casualties.
October is historically a bad month for stock markets worldwide. If there's a crash, there's a good chance it will happen this month, and this year the selling started early.
We're less than three days into October 2019, but the FTSE 100 is already down 4.5%, unwinding almost all the hard-won gains made since the end of August. And the main index looks vulnerable.
Currently, the FTSE 100 index is still up 5.2% for the year to date, but it was up almost 15% at the end of July. It has lost around 8.4% since then.
|Index||% change since 30 Sept 2019|
|Swiss Market Index||-3.04|
|Dow Jones Industrial Average||-3.11|
|FTSE AIM All-Share||-1.4|
|China||Closed this week|
What's interesting here is not that the market has fallen so far, so quickly, but rather which stocks have led the decline.
Big names like Hargreaves Lansdown (LSE:HL.), off almost 13% in the past few days, paper and packaging giant DS Smith (LSE:SMDS) down over 9%, and B&Q-owner Kingfisher (LSE:KGF), Rolls-Royce (LSE:RR.), Burberry (LSE:BRBY) and Prudential (LSE:PRU) not far behind.
In fact, the only risers in October so far are Paddy Power and Betfair-owner Flutter Entertainment (LSE:FLTR) – it's only up because it just announced a mega-merger with Toronto-listed Skybet-owner The Stars Group (TSE:TSGI) - and US -focused plumbing supplies giant Ferguson (LSE:FERG).
Clearly, news this week that US stockbroker Charles Schwab (NYSE:SCHW) is scrapping trading commission is a read-across to UK peers, although investors also have concerns around share valuations. Protests in Hong Kong have knocked fashion house Burberry and insurer Prudential, while an ongoing decline in American construction spending weigh on US-focused equipment hire firm Ashtead (LSE:AHT).
Kingfisher has gone ex-dividend today, which won't have helped, but concerns about the French business refuse to go away, offsetting strength at the UK Screwfix business. DS Smith has also just started trading without rights to the latest payout.
|Company||Ticker||% change since 30 Sept 2019||Forward price/earnings (PE) ratio||Forecast dividend yield (%)|
|Hargreaves Lansdown (LSE:HL.)||HL.||-12.8||31.7||1.8|
|DS Smith (LSE:SMDS)||SMDS||-9.13||9.7||4.7|
|St James's Place (LSE:STJ)||STJ||-7.89||21.6||5.3|
|British American Tobacco (LSE:BATS)||BATS||-7.22||8.9||6.7|
|Melrose Industries (LSE:MRO)||MRO||-7.17||14.3||2.4|
|Johnson Matthey (LSE:JMAT)||JMAT||-7.16||12.2||3.0|
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