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European equities sell off sharply
Manchester News.Net
Monday 6th October, 2008
Stock markets in Europe joined their Asian counterparts Monday in sending stocks into a tailspin.
At the close of trading in London the FTSE 100 was off 5.77%. The Paris-based CAC 40 was off 9.04%, and the German DAX 7.07%.
The Swiss SMI was down 6.12%.
Investors were facing news of a new 50 billion euro government bailout of Hypo Real Estate, Germany's second-biggest commercial property lender.
They were also reacting the sharp falls on Wall Street on Friday, and to the jobs data released in the U.S. on Friday which showed the world's biggest economy had lost 159,000 jobs last month. The biggest factor however, which accelerated the falls in Europe, was the Wall Street opening Monday which saw the Dow Jones plunge more than 500 points in early trading. By l;ate afternoon, after European markets had closed, the Dow was down more than 700 points.
Asian markets closed down across the board. The worst performing index was the Jakarta Composite which lost 10.03% of its value. The Indonesian market had been closed last week for a four-day break to mark the end of Ramadan, and the government had urged investors not to panic when trading resumed following the turbulence on global financial markets.
The Nikkei 225 in Japan fell 4.25%, the Shanghai Composite 5.23%, and the Australian All Ordinaries 3.36%.
On foreign exchange markets the U.S. dollar was being bought up, just as the price of oil was edging below $90 a barrel. The euro was quoted in late afternoon trading in Frankfurt at 1.3562, a fourteen months low. The Swiss franc had buckled to 1.1410, while the Australian dollar was in freefall, quoted last at just over .70 cents.
The British pound was down at 1.7350, while the Japanese yen was going against the trend. It was last quoted approaching 100 yen to the dollar.
The Canadian dollar was being shunned at 1.1000.
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