Stocks, commodity currencies slide as oil falls back below $30

World stocks were set for a third straight week of losses on Friday and commodity currencies took another drubbing as oil prices fell back below $30, keeping alive concerns about global growth.

European stocks fell more than 1 per cent, heading back towards Thursday’s 13-month lows, while Asian shares skidded to 3-1/2 year lows.

Oil prices, which posted their first significant gains for 2016 on Thursday, came under fresh selling pressure as the prospect of additional Iranian supply loomed over the market.

Brent crude fell 3 per cent to $29.86, heading for a weekly loss of more than 10 percent. US crude fared even worse, sliding almost 5 per cent to $29.75, and was set for a weekly decline of 10 per cent.

The collapse in oil prices has spooked financial markets as investors worry about the health of the global economy, with a slowdown in China and volatility in its markets making for a nervous start to the year.

“It’s been another immensely volatile week,” said Philip Shaw, chief economist at Investec in London.

The Shanghai Composite lost 3.5 per cent, while the CSI300 tumbled 3.2 per cent. That put the former on track for a 9 per cent loss for the week, and the latter for a decline of 7.2 per cent.

Chinese shares extended their losses after data showed new yuan loans in December were well below the previous month’s lending, and broad M2 money supply growth also slowed, with both missing expectations.

China will publish a host of data on Monday and Tuesday, including fourth quarter gross domestic product.

US retail sales data due later on Friday will also be on investors’ radar as they try to gauge the likelihood of the Federal Reserve raising interest rates again in March.

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