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European equities under pressure
Austin News.Net
Friday 10th October, 2008
European bourses were sharply lower Friday, following substantial falls on Asian markets, and Wall Street.
Losses however were trimmed towards the close as signs emerged on Wall Street that stock prices may be stablising there, albeit after a volatile opening.
In London near the close the FTSE 100 was down 5.24%, well off earlier lows stretching towards the 10% mark. The Paris-based CAC 40 was down 7.27%, while the German Dax was off 7.08%.
The Swiss SMI was down 4.75%.
Wall Street saw the Dow plunge 700 points in the first seven minute of trading. Within 30 minutes however the benchmark index was in positive territory. In late morning trading the index was down 249 points.
The global stockmarket meltdown has been gathering pace all week. The U.S.-sponsored $700 billion rescue package, co-ordinated interest rate cuts, ntionalisation and part-nationalisation of banks by various governments, have all failed to allay the fear being experienced by investors. The selling on most exchanges has reached a panic stage where sellers are prepared to accept any price to convert scrip into cash.
Margin calls by lenders are also exacerbating the problem causing shareowners to cash in their scrip to repay loans.
G-7 finance ministers are meeting in Washington to consider further steps to combat the global crisis.
On foreign exchange markets the safe-haven low-yielding currencies, the Japanese yen, Swiss franc and U.S. dollar were all in demand, while hih-yielding currencies were all under pressure.
The Australian dollar swooned to .6540 in morning trading in New York. The Canadian dollar collapsed to 1.1835, while the British pound dived to a five year low at 1.6800, before recovering to 1.7040.
The euro fell to 1.3518. The Japanese yen hit 97.91 earlier in Asia but had retreated in New York trading to 99.84. The Swiss franc rose to 1.1219.
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