Tuesday, January 22, 2008
BIG $HITPILE HITS THE WALL WORLDWIDE
Global stocks plunge on US recession fears
Billions of pounds were wiped from company share values this morning as fears of a US recession reverberated around the globe, sending FTSE 100 index down to its worst level in 15 months.
London's benchmark index of blue chips dived by 117 points to 5,785 when the market opened this morning, following frenzied trading in Asia as investors drained cash from the Tokyo and Hong Kong markets.
In the UK, mining companies, retailers and banks bore the brunt of the markdown in prices as dealers decided that President George W Bush's proposed stimulus package for the US economy, that was revealed last week, would not be enough.
World Markets Plunge on Fears of U.S. Slowdown
FRANKFURT — Fears that the United States may be in a recession reverberated around the world on Monday, sending stock markets from Mumbai to Frankfurt into a tailspin and puncturing the hopes of many investors that Europe and Asia would be able to sidestep an American downturn.
GLOBAL MARKETS-Stocks hammered
Share markets from Tokyo to Sydney slumped between 4-8 percent, with India's benchmark Sensex crashing more than 11 percent at one point, triggering a trading halt.
"It's like a funeral in here," said Ken Masuda, senior equities dealer at Shinko Securities in Tokyo. "No one knows what's going to happen tonight in New York. It's like we've gone blind, you don't know what's coming.
"Until we see New York, all we can do is sell," he said.
U.S. stock index futures fell around 4.5 percent, signalling a sharp sell-off on Wall Street later.
All eyes are on earnings from Bank of America later, anxious to see if there are further writedowns related to exposure to risky mortgages.
The sell-off, which has rocked markets since late December, gathered pace sharply on Friday where U.S. equity markets suffered their worst weekly performance since mid-2002, showing a clear lack of confidence in Washington's proposed fiscal stimulus worth up to $150 billion. Wall Street reopens later after a holiday on Monday.
Comments from IMF Managing Director Dominique Strauss-Kahn that all developed countries were suffering from the U.S. slowdown entrenched fears that global growth was hitting a wall.
Billionaire investor George Soros said the world was facing the worst financial crisis since World War Two and the United States was threatened with recession.
Proposed stimulus package: for every point drop in the DOW today we get to heave 100 supply sider wingnuts into a live volcano.