💾 Archived View for gmi.noulin.net › mobileNews › 695.gmi captured on 2024-08-25 at 07:10:51. Gemini links have been rewritten to link to archived content
⬅️ Previous capture (2024-05-10)
-=-=-=-=-=-=-
2008-10-10 10:25:38
Stock markets across Europe have fallen steeply after dramatic share price falls in Asia.
The FTSE 100 share index was down 5.4% at 4,077 points. It opened 9.8% lower at 3887 points, below the 4,000-point level for the first time in five years.
There were similar falls across Europe - Paris was down 6.2% while Germany was down 8.2%.
The market mayhem has not eased despite interest rate cuts and hugh cash injections by central banks this week.
In Russia, regulators suspended stock market trading indefinitely, citing excessive volatility. The market had been shut temporarily on Wednesday.
"It's a banking problem, it's a credit crisis problem and its complete loss of confidence worldwide," said David Buik of BGC Partners in London.
Despite concerted government action, investors are increasingly fearful the financial crisis will prompt a global recession.
The BBC's business editor Robert Peston said markets were worried about Friday's auction of insurance claims on the debts of the collapsed US investment bank, Lehman Brothers.
The underlying illness remains in the sytem - as manifested in the record amounts banks were charging each other yesterday for lending to each other
Robert Peston
BBC Business Editor
This could not come at a worse time for bank shares, said our correspondent.
'Unstoppable selling'
Heavy falls were seen across Asia's markets as a climate of fear took hold on Friday.
In India, the Mumbai market plunged 6.5% in early trading. Shortly afterwards, India's central bank said it would make an additional $12.8bn ( 7.5bn) available for the money markets.
In Japan as the Nikkei index slumped in its biggest one-day fall since the 1987 stock market crash, the crisis claimed its first Japanese financial institution, with the insurance company Yamato Life going bankrupt.
FROM THE TODAY PROGRAMME
Please turn on JavaScript. Media requires JavaScript to play.
"Selling is unstoppable in New York and Tokyo," said Yutaka Miura, senior strategist at Shinko Securities in Tokyo.
"Investors were gripped by fear."
At the end of trading on Friday, Tokyo shares had plunged 24% during the week - double their weekly fall during the 1987 market crash.
'Pure panic'
Elsewhere in Asia was a similar story.
Australian shares closed down 8.3%, Hong Kong's benchmark Hang Seng index slumped to a three-year low while in the Philippines, share prices closed down more 8.3%.
In Indonesia, plans to re-open the stock market were suspended in order to prevent what the president of the exchange called "deeper panic". Trading was halted for two days earlier this week.
The Dow Jones - the US benchmark index - ended down 7.3% on Thursday - tumbling below 9,000 points for the first time since August 2003.
"We're way beyond fundamentals," said Chris Orndorff, head of equity strategy at Payden & Rygel, in Los Angeles.
"This is just pure panic, that's all it is."
Crisis meetings
Finance ministers from the G7 leading industrial countries are set to meet in Washington to discuss the crisis.
US President George W Bush is due to make an address to the American people later in the day.
As well as the G7 meeting, talks will be held at the International Monetary Fund (IMF) in Washington.
The IMF has said it is ready to lend to countries hit by the global credit crunch, using an emergency lending procedure first used in the 1990s Asian crisis. It has about $200bn immediately available to lend but can tap other sources.