The U.K.’s main stock index tumbled on Wednesday, posting its fifth straight daily drop as energy and commodity-related stocks declined and investors monitored the persistent turmoil in Turkey’s currency and equity markets.
How markets are performing
The FTSE 100 /zigman2/quotes/210598409/delayed UK:UKX +1.19% ended down 1.5% to 7,497.87, shrugging off an early slight rise to turn decidedly lower. The index marked its biggest one-day drop since June 25, as well as its longest streak of daily drops since Feb. 6, according to Dow Jones Market Data.
Thus far this week, the FTSE is off 2.2%, and it is down 3.2% over the course of August.
The British blue-chip gauge is showing a drop of 2.5% for the year to date.
The pound /zigman2/quotes/210561263/realtime/sampled GBPUSD +0.1603% was buying $1.2692, a decline of about 0.2%.
What’s moving markets
Brent crude oil fell 2.6% and was trading near its lowest level since April, while industrial metals were roundly lower. Crude prices were pressured after inventory data showed an unexpected rise, a negative sign for demand.
Investors continued to monitor the currency crisis in Turkey, which many fear could spread and have a negative impact on the European banks with exposure to the region. The region showed some signs of stabilization, and it was reported that Qatar would invest $15 billion in the country.
The Turkish lira /zigman2/quotes/210561870/realtime/sampled TRYUSD -0.1320% jumped 5.7% against the buck, bringing its week-to-date gain to 4.7%. However, it remains sharply lower of late, having dropped about 20% thus far this month, recently hitting an all-time low.
Volatility should remain elevated, after Turkey raised tariffs on a number of American products, in the latest escalation in tensions between the two countries. U.S. President Donald Trump raised tariffs on Turkish aluminum and steel last week; the latest tariffs from Turkey are in response to those “conscious attacks,” according to a translation of a tweet posted by Fuat Oktay, the country’s vice president.
Beyond Turkey, overseas markets remained a point of concern. Asian markets ended lower as investors fretted over the prospect of slowing growth in China.
Also in focus was a round of U.K. data, including reads on inflation. The consumer-price index rose 2.5% in July, in line with expectations, while it was flat compared with June.
Separately, the producer-price index was up 3.1% year-over-year, while it was flat, compared with last month. The mean estimate of analysts polled by FactSet was for a gain of 3% from July 2017.