Economists expect Footsie to bounce back in 2002
Economists expect the Footsie to bounce back next year.
The FTSE 100 Index of blue chip shares fell by 16% over 2001. At its close today, the Index had fallen 25 points to 5217.4.
This compares with the 6,222.5 it registered at the start of the year. In 2000 it suffered a 10% slump as tech stocks were sold off in the wake of the bursting dotcom bubble.
The highest point of the past year was January 30, when the Footsie touched 6,334.5, while the lowest was September 21 when it slumped to 4,433.7 following the US terrorist attacks.
Predictably, the biggest single day percentage fall was on September 11, when the Footsie shed 5.7% to close at 4,746.
But although the future global economic outlook is steeped in uncertainty, analysts and economists are hoping for a better year on the markets in 2002.
Most economists are pencilling in a Footsie rally to 5,500 or above, with some expecting the market to surge above 6,000.
Hilary Cook, director of investment strategy at Barclays, is predicting the market will end 2002 at 6,000.
"The market is discounting a lot of bad news at the moment," she says.
"I believe as we go through 2002, the news flow will start getting better on the corporate profit front and as the market gains confidence, we could see quite a rapid bounce."
Alex Scott at 7 Investment Management is forecasting 5,800 for the Footsie.
"We are expecting it will be steady and unexciting - but we like that after two years of falls," he says.
