Global stock markets plunged on Monday, deepening last week’s heavy losses, as escalating trade tensions triggered renewed fears of a worldwide recession.
London’s FTSE 100 bore the brunt, falling by 488 points, or 6%, to 7566 — its lowest level since February 2024.
The fresh rout eclipsed even Friday’s near-5% slide, which followed China’s retaliation against US tariffs with levies of its own.
The mood among investors darkened further over the weekend, as President Donald Trump defended his aggressive tariff policy, calling it “medicine” for the economy.
Every share in the FTSE 100 index ended in negative territory, with industrial stalwart Rolls-Royce slumping by 13%.
Miners, banks, and investment firms also found themselves at the sharp end of the sell-off, reflecting broad-based concerns about the global economic outlook.
Barclays and Lloyds shares plunge as banks and commodities hit hard
The banking sector, already under pressure from expectations of lower interest rates, saw some of the steepest falls.
Barclays dropped by 7%, Lloyds Banking Group slipped 5%, and NatWest shed 7%.
Asia-focused lenders were similarly battered, with HSBC down 5% and Standard Chartered tumbling 7%.
Commodities were not spared. Mining giants Glencore and Anglo American each saw losses of 7% and 8%, respectively.
Energy stocks followed suit as Brent crude oil prices fell below $64 per barrel, dragging BP and Shell down by 7%.
Kathleen Brooks, research director at XTB, remarked that markets are searching for definitive action rather than rhetoric.
“The best panacea for financial markets right now would be a pause or reversal from the US on its tariff programme,” she said.
DAX plunges 10% as Europe and Asia slide
The turmoil spread across Europe, where Germany’s DAX index plunged 10% in early trading, France’s CAC lost 6.6%, and Italy’s FTSE MIB fell 5.7%.
The regional Stoxx 600, already reeling from its worst week in five years, slid further into negative territory.
In Asia, stocks continued to bleed, with China at the forefront of the sell-off.
Trump’s sweeping tariffs hit not only China with 34% duties but also extended to Vietnam, Cambodia, and Sri Lanka, compounding fears for global supply chains.
Richard Hunter, head of markets at Interactive Investor, said, “China is clearly in the mood for the fight, and with the world’s two largest economies at loggerheads, the result has been ugly for investors.
On Wall Street, investors braced for further volatility after the “Magnificent Seven” tech giants saw a staggering $1 trillion in market value erased in just one day last week.
Despite the market carnage, President Trump remains resolute.
Speaking to reporters on Sunday, he insisted, “Sometimes you have to take medicine to fix something,” suggesting no imminent change in course.
The futures market indicates the US S&P 500 will slump by another 3.5% when trading begins later today, with the tech-focused Nasdaq index on track for a 4.5% tumble.
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