Thread: Stock markets plunge across world. Have a good weekend :(

Stock markets plunge across world
Global share markets are falling amid investors' widening fears of a sustained worldwide economic recession.
Wall Street tumbled sharply in morning trading, following similar falls in markets across Europe and Asia.
The Dow Jones Industrial Average fell nearly 3%, paring early losses while the hi-tech Nasdaq index declined by more than 2%.
On European markets, London closed 5% lower, Frankfurt slid more than 5% and Paris was down more than 3.5%.
Investors have been dumping shares worldwide because of gloomy prospects for the global economy - and are looking at other forms of investment.


Amid wider signs of the global economic slowdown:

• Asian shares tumbled, with Tokyo down 9.6%, Seoul plunging 10.6% and Hong Kong falling 8.3%
• Oil prices have continued to fall, despite Opec's efforts to steady prices by cutting output by 1.5 million barrels a day. US, light sweet crude fell $3.30 to $64.54. London Brent dropped $3.35 at $62.57
• The UK economy shrank for the first time in 16 years between July and September, confirming that Britain is on the brink of recession
• The pound saw its biggest one-day drop against the dollar since 1992 falling to $1.52, its lowest level in six years, before rebounding slightly to $1.58.
• The euro dropped to $1.25, its lowest level for two years, on expectations of eurozone interest rate cuts and slowing economic growth
• In Moscow, share trading was suspended on both main share indexes until 28 October, after they plunged more than 10%.

Investors are now trying to ascertain how deep the global recession will be and the impact on future growth
Chris Jarvis
Caprock Risk Management

Global money markets have showed renewed signs of stress, despite the billions of dollars that central banks and governments have pumped into the markets in recent weeks. Investors worldwide are worried about falling share prices and the possibility of companies defaulting on their debts.
As a result, they have been selling shares in markets across the globe and switching to less risky forms of investments, such as government securities.
'Awful cycle'
On Friday, the yield on US Treasury bills fell - a sign that demand for them is high and investors are willing to earn lower returns in exchange for a safe investment.
However, there was one glimmer of hope and a sign that banks may be more willing to lend to each other. Three-month lending rates among banks in the US and Europe dipped slightly.


What's the real impact of the economic slowdown? BBC News is taking the temperature across the UK in a special day of coverage

The rate for lending dollars over a three month period eased to 3.52%, though the fall was very slight - just 0.02%.
The rates have fallen steadily for 10 days, as confidence in the banking sector has been helped somewhat by all the rescue measures announced by governments.
"Investors are now trying to ascertain how deep the global recession will be and the impact on future growth," said Chris Jarvis, at Caprock Risk Management, New Hampshire.
The dollar and yen both rose sharply against most other major currencies, kindling speculation that central banks might be forced to intervene to rein in volatile moves.
"You are seeing the currencies move as they would in any sort of full-fledged panic," said Firas Askari, at BMO Capital Markets in Toronto.
"I think we have to be close to the end of this awful cycle. It's usually darkest at the bottom," he said.



Story from BBC NEWS:
BBC NEWS | Business | Stock markets plunge across world

Published: 2008/10/24 16:03:42 GMT

Wall Street plunges amid global meltdown

Posted 3 hours 11 minutes ago
Updated 3 hours 6 minutes ago
Wall Street fell less than many other global stock markets in early trade (ABC News)

• Related Story: OPEC slashes output to halt free-falling prices

US shares have plunged amid a wave of panic selling and a meltdown in share prices around the world on rising fears of a global recession.
But Wall Street shares pared some of its losses and fell less than many other global stock markets in early trade.
The Dow Jones Industrial Average fell 365.42 points (4.20 per cent) to 8,325.83 in the first 20 minutes of trade, moving up slightly from steeper opening losses.
The Nasdaq saw a dive of 70.70 points (4.41 per cent) to 1,533.21 and the Standard and Poor's 500 index sank 44.74 points (4.93 per cent) to 863.37.
The market action came amid a wave of panic in markets around the world as mounting evidence signalled that major economies are heading for recession from a credit crunch and banking crisis.
"We have now reached a point where fundamentals and long-term valuation considerations do not matter any more for financial markets," said economist Nouriel Roubini at New York University.
London stocks plunged more than 9 per cent to a five-year low, Frankfurt crashed by 10.13 per cent and Paris tumbled by more than 7 per cent approaching the half-way stage of trade.
In Asia, Tokyo sank nearly 10 per cent, and Hong Kong tumbled as concern grew that the chronic financial crisis was taking a heavy toll on company earnings.
Markets reacted to a profit warning from Japan's Sony Corp. that sparked fears of an industry wide earnings slump and a weak outlook from US software giant Microsoft.
The rout came on "fears of global recession weighing heavily on company profits," according to Jason Kunkel at Moody's Economy.com.
"There is a free fall as most investors are rapidly deleveraging and we are on the verge of a a capitulation collapse," Mr Roubini said.
"What matters now is only flows - rather than stocks and fundamentals - and flows are unidirectional as everyone is selling and no one is buying as trying to buy equities is like catching a falling knife.
"There are no buyers in these dysfunctional markets, only sellers and panic is the ugly state of this destabilising game."
Al Goldman at Wachovia Securities said the plunge is caused by forced selling by hedge funds that are using borrowed cash and which must meet redemptions.
"The main cause is that hedge funds are being forced to liquidate positions because they are so leveraged due to credit default swaps," he said.
"Estimates run to 30 to 40 times leveraged. This is forced selling, not an investment judgment call."
- AFP


http://abc.com.au/news/stories/2008/...section=justin

^Why is this news to you? If you read my thread from February, you wouldn't affected by this.

Money is relative.

If every market in the world sinks, it's a wash.

If everyone gets poorer at similar rates, it's meaningless.

I'm glad I have no bills.

Originally Posted by Texpat

Money is relative.

If every market in the world sinks, it's a wash.

If everyone gets poorer at similar rates, it's meaningless.

I'm glad I have no bills.

Correct - and I am happy to have no bills, apart from the foking electric, water, beer, food, crumpet................................

I am bit disappointed that the DOW only went down 300 points or 4% yesterday,

Originally Posted by bkkandrew

If you read my thread from February, you wouldn't affected by this.

Sorry, Mate. I know this may come as a shock and possibly a bitter disappointment but I don't read every thread/post you make. I'm so sorry.
I'll try and make a point of reading them all from now on.
Sorry.
Please forgive me.

Did I say "I'm sorry"?

Cos I am.


Honestly..




Really sorry.