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Stock market turmoil: FTSE’s 10 worst days

Share falls in August 2011 have revived memories of the 2008 financial crisis

Financial markets on both sides of the Atlantic have been convulsed in August by a fresh wave of selling amid fears that the world economy is sliding back towards recession. But recent falls are overshadowed by losses seen at the height of the financial crisis in 2008, which are themselves beaten by the 1987 crash (or Black Monday), where the FTSE dropped nearly 25% in two days. This period brought the decade of privatisation and widespread share ownership to an abrupt end after many years of gains. Panic selling on Wall Street also helped fuel the crash in the London market.

The most recent share crash, in 2008, was triggered by high-profile bank failures in the US after the sub-prime mortgage crisis, and heralded a global economic recession not seen since the 1930s Great Depression.

While the share price falls in August 2011 are alarming, they fail to make it into the top 10 biggest falls, in either percentage or points terms. And it remains unclear whether they are an early warning sign of an economic recession.

A note on methodology:

Falls in percentage terms are easier to compare over time periods than points falls, due to changes in the level of the index since its inception. For example, a 200 point fall in October 1987 wiped 12% off the index, the largest fall seen so far; a 200 point fall in August 2011 would knock the FTSE 100 off by 4%, which isn’t enough to make it into the top 10 largest percentage falls.

The FTSE 100 was established in 1984 at 1,000 points. It counts 100 of the largest UK companies as its constituents, with a combined market capitalisation of £1549bn. © Guardian News & Media Limited 2011 | Use of this content is subject to our Terms & Conditions | More Feeds