World Bank made an announcement early this week that this year, the global market will experience slow growth. With the news, the stock markets took a tumbling.
Why World Bank’s statement has so much impact
The World Bank being the primary source of loan or capital for most countries and businesses is in itself a pool of experts when it comes to world economy. Through the years, World Bank’s pronouncements on the rise and fall of global economy have been precise. It has proven itself to be some world standard and herald when it comes to news on global economy.
It is not therefore surprising why this sudden decline of market occurred. It has always been evident in the market world that when a leading industry, nation or organization announces something, it will have direct impact on the trading the next day. People will either be fearful or get greedy with the news. This time around, with the newest assessment of World Bank of the world’s economy, most were fearful. The sellers dominated the market. They sold shares out of fear or profits were already reached.
Close look on stock performance
Mining companies that supply manufacturers in the US and China fell deeply dragging the FTSE to close to 6388. This is 2.2% down from previous day. Glencore performed worse. It experienced a four year bottom low and when it lost 9% of its value mainly because of the mining industry’s poor performance. Kaz minerals plunged by 26%. It gets its supply of minerals from Kazakhstan. Anglo American dropped also by 8.5%
Standard Chartered also lost 5% of its value because of this news from World Bank. You cannot also contain the poor sales in the retail industry in the United States especially that people lost their confidence in the market with the unstable economic growth. This includes the industry in packaging. You might not have daily encounter with such words as tulle, baskets, cellophane, shipping boxes and wine bags; however, if you are a businessman involved in packaging, these are common jargons for you. The industry of packaging is also greatly affected with slow economic growth news.