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A stock market crash — defined as a fall in a day (or over the course of several days) of over 20% from a recent peak — is a rare thing.
In fact, the FTSE 100 has only crashed once — in October 1987. But a look at the five biggest one-day falls reveals that four of them occurred in October. That’s why I get scared whenever the month of Halloween approaches.
| Date | % fall |
|---|---|
| 20 October 1987 | 12.22 |
| 12 March 2020 | 10.87 |
| 19 October 1987 | 10.84 |
| 10 October 2008 | 8.86 |
| 6 October 2008 | 7.85 |
Not this time
But this year, I’m more confident that we can avoid such a disaster. There’s no evidence to suggest that we’re on the verge of a banking crisis similar to the one that caused the global financial crash of 2008. And I like to think that regulators learned lessons from Black Monday in 1987 when computerised trading models caused widespread investor panic.
However, I’m not complacent. There’s plenty of evidence around to suggest that US stocks are overvalued. And when America sneezes, the world catches a cold. That’s why I suspect a FTSE 100 correction — a fall of 10% from a recent high, albeit over an extended period — is more likely. And there have been plenty of those over the years.
Forget about October
Contrary to my fears, it turns out that September has been the worst-performing month for global stock markets over the past 50 years. Research by Finder shows that October is actually the third best month for returns. But these things are impossible to predict. And looking at the average hides a wide variation in individual performances.
For example, those who took a stake in Fresnillo (LSE:FRES) in September 2024 have seen their investment more than triple in value over the past 12 months.
The gold and silver miner has been a huge beneficiary from soaring commodity prices. Over this period, gold and silver have risen more than 40%. At the same time, the devaluation of the Mexican peso has lowered its costs. During the first half of 2025, this magical combination resulted in a 138% increase in profit before tax compared to H1 24.
However, there are risks. Prices could fall just as quickly as they have risen. And miners face all sorts of potential operational problems that could interrupt production.
What next?
But as long as gold and silver prices remain historically high, the group will remain hugely cash generative. During H1 25, it generated cash from its operations of $1.1bn. This helped improve its net cash position from $458m at the end of 2024 to $983m at 30 June.
At the moment, the group anticipates production in 2026 and 2027 being broadly in line with current levels.
Gold is seen as something of a safe haven during times of global uncertainty. It’s currently trading at around $3,640 an ounce. Goldman Sachs reckons it could hit $5,000 in 2026, although the investment bank thinks $4,000 is more likely. Concerns over political interference with the Federal Reserve — leading to higher inflation and a lower dollar — could help drive it higher.
Of course, nobody knows for sure but the direction of travel appears to be more global uncertainty, not less. On this basis, the Fresnillo share price could act as a hedge against this and make the stock one for investors to consider buying this month (or next).
