The latest crisis surrounding Evergrande resulted in some contagious selling of risk assets to start the week. However, most analysts see little risk of the Evergrande crisis becoming another Lehman brothers type crash which started the 2008 financial crisis. Therefore, the latest dips in the FTSE 100 could provide a great opportunity to buy in at better prices for a possible run higher into the end of the year.

Over the last 21 years, the FTSE 100 has risen 16 times between Sept 23 and Dec 29. The average rise has been 3.07% and the largest gain was in 2001 with a 13.08% rise. The largest fall was in 2008 with a large -15.90% loss.

Major Trade Risks:

  • If Brexit supply issues prove more of a problem than the UK expected this could result in some further downside in the FTSE.
  • If the Evergrande crisis poses more of a contagion risk then the FTSE 100 may have more room to fall lower in line with other risk assets.