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FTSE 100 falls 2% as markets fear inflation

BBC News logo BBC News 5/11/2021
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The UK's benchmark share index, the FTSE 100, has tumbled more than 2% on global inflation worries.

It follows similar falls in Asia and the US as traders fear rising inflation could lead to higher interest rates.

The index has now retreated below the 7,000 mark to 6,980 after hitting a post-pandemic high of 7,164 on Monday.

"The market just can't shake the inflation fears which are clouding the recovery from Covid," said AJ Bell investment director Russ Mould.


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"Surging commodity prices are acting as a canary in the coal mine for inflation - with the huge infrastructure and stimulus packages in the US a key contributing factor."

The US tech-focused Nasdaq index fell 2.55% on Monday and the sell-off has continued.

"This is shaping up to be another tech bleed as we saw in September last year, with a sea of red on the boards in Europe this morning," said Neil Wilson, chief markets analyst for markets.com.

Both France's Cac 40 index and Germany's Dax index are down by nearly 2%.

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