On February 6, European markets have followed Asian markets lower as investors continued to dump shares.
Frankfurt, London and Paris all fell sharply at the open with losses of up to 3%, before recovering some ground.
In the US overnight the Dow Jones lost 4.6%.
Japan’s Nikkei 225 closed down 4.7%.
The sell-off began last week after data in the United States showed stronger wage growth, which raised expectations that US interest rates might start to rise more quickly to tackle inflation.
Frankfurt’s Dax and Paris’s CAC were down 2.2% and 2% respectively.
London’s FTSE 100 was down 150 points or 2% at 7,184.74 in mid morning trade.
On February 5, the FTSE 100 closed at its lowest level since April 2017.
The falls follow some good years for investors.
Last year, the Dow Jones was up 25% and London’s FTSE 100 rose 7.6%.
Hong Kong’s Hang Seng ended closed 5% lower and South Korea’s Kospi index gave up 2.6%. Australia’s benchmark S&P/ASX 200 lost 3.2%.
Japan’s Nikkei saw steeper falls overnight, with a loss of some 7% at one point.
Unlike elsewhere in the world, where interest rates are beginning to or are expected to start rising, Japan’s immediate economic outlook remains stagnant. The authorities there said there was little chance of interest rates being increased.
Traders returned to their desk in the aftermath of Friday’s rout to another bout of selling.
That left the Dow Jones Industrial Average index down 1,175 points, or 4.6% at the end of Monday’s session to 24,345.75.
The decline was the largest in percentage terms for the Dow since August 2011, when markets dropped in the aftermath of “Black Monday” – the day Standard & Poor’s downgraded its credit rating of the US.
The drop on the Dow Jones was closely followed by the wider S&P 500 stock index, down 4.1% and the technology-heavy NASDAQ, which lost 3.7%.
However, the White House reassures investors saying it was focused on “long-term economic fundamentals, which remain exceptionally strong”.
The Dow Jones Industrial Average has passed the 20,000 milestone for the first time on January 25.
The S&P 500 and tech-heavy NASDAQ were also at new highs, fuelled by hopes that President Donald Trump’s policies will boost the economy.
The Dow was up 0.8% at 20,074 points in afternoon trading.
Investors’ cash has poured into shares on hopes of tax cuts and higher growth.
Image source AP
Donald Trump’s senior adviser Kellyanne Conway was quick to comment on the news, tweeting that the landmark was down to “The Trump Effect”.
If the index stays above 20,000 by the time the day’s trading ends, then it would mean the 42-session rise from the first close above the 19,000 mark would be the second quickest 1,000 point rise of all time.
The Dow rose from 10,000 to 11,000 in only 24 trading days between March 29 and May 3, 1999, while the rise from 18,000 to 19,000 took 483 trading days (nearly two years).
Financial stocks have been a major factor in the gain – with Goldman Sachs and JPMorgan accounting for around 20% of it.
This is because investors believe that some of Donald Trump’s policies will trigger inflation and produce a rise in interest rates.
Global stock markets have risen, a day after billions were wiped off the value of shares amid global market turmoil.
In the US, the Dow Jones was up 123.96 points, or 0.8%, at 15,7890.70 in early trade.
European markets were also higher, and shares in the US were up shortly after trading began.
However, investors remain worried over the continuing slide in oil prices and slowing growth in China.
London’s FTSE 100 index, which measures the share prices of the 100 most valuable companies traded on the London Stock Exchange, was up nearly 1.5%.
The index rose 83.10 points to 5,756.68, and the share indexes in France and Germany were both up by more than 1.5%.
Much earlier, Japan’s main share index closed down by more than 2%.
On January 20, global stock markets suffered hefty losses and London’s FTSE 100 ended the day down 3.5%.
By doing so it entered a “bear market”, having fallen 20% from its record high in April 2015.
Oil prices remained weak on January 21, having hit their lowest levels since 2003 in the previous session.
A brief rally in crude prices quickly ran out of steam, and after climbing back above the $28-a-barrel mark, Brent crude fell back to $27.75.
US crude was 1% lower on the day, trading at $28.09 a barrel, having fallen below $27 on January 20.
Crude oil prices have been falling since mid 2014, but oil-producing countries have maintained output despite the decline, contributing to the excess supplies on the market.
Earlier in the week, the International Energy Agency warned that oil markets could “drown in oversupply” in 2016.
According to the Labor Department figures, the US economy added only 142,000 jobs in September 2015, lowering the chance of an interest rate rise this year.
The number of jobs created in September was far lower than the 205,000 increase forecast by economists.
The July and August figures were revised down by a combined 59,000.
On October 2, Wall Street opened sharply lower, with the Dow Jones and S&P 500 indexes both down about 1.3%.
However, both indexes later recovered to be up about 0.5% and 0.6% respectively.
The poor figures also resulted in a rollercoaster ride for the FTSE 100, which ended the day up 0.9% at 6,129.9 points despite also turning negative in afternoon trading.
The Labor Department numbers reinforced fears that the China-led global economic slowdown is hitting America’s recovery, adding to doubt about whether the Federal Reserve will raise rates before 2016.
The number of new jobs for August was cut by 37,000 to 136,000 – in sharp contrast to the upward revision expected by economists.
The July total was also reduced, by 22,000 to 245,000.
The number of new jobs created in the US has averaged 198,000 a month for 2014 – below last year’s average of 260,000.
However, the unemployment rate held steady at 5.1%.
The jobless rate, which is derived from a separate survey of households, was unchanged only because 350,000 workers stopped looking for work last month and were no longer counted as part of the labor force.
The proportion of Americans who either have a job or are looking for one fell to a 38-year low, partly reflecting retirements of older workers from the baby boomer generation.
Average hourly wages fell by 1 cent to $25.09 during the month and were only 2.2% higher than the same month in 2014.
The data also knocked the dollar lower, with the pound rising 0.6% to $1.5238 after the numbers were released. Yields on government bonds also fell.
Asian stock markets opened higher on November 6 after US stocks hit record highs on Republicans taking control of the Senate.
The Republican victory raised investor hopes for more pro-business and energy-friendly policies from the US government.
The Dow Jones jumped to a new record close of 17,484.53, while the S&P 500 also finished at a record 2,023.57.
Japan’s Nikkei 225 index was up 0.4% to 17,012.71 after five days of gains.
The yen strengthened marginally against the dollar to 114.63, down from 114.69 yen in New York trade.
Asian stock markets opened higher after US stocks hit record highs on Republicans taking control of the Senate
In Greater China, Hong Kong shares opened up 0.2% with the Hang Seng index at 23,737.76.
The benchmark Shanghai Composite index was higher 0.1% to 2,423.23 points.
In Australia, shares were trading lower 0.1% with the benchmark S&P/ASX 200 index at 5,510.20 points despite news that employment figures rebounded in October.
Government data showed that Australia added an estimated 24,100 jobs in October, recovering from a revised 23,700 drop in September. But concerns about the reliability of the data that has been revised a few times in past months weighed on investor sentiment.
Shares of struggling television channel Ten Network rose as much as over 10% in early trade after it said it had hired Citigroup to assess “strategic options” as reports surfaced of takeover offers.
In South Korea, the Kospi index was up over 0.3% at 1,937.78 points.
The US stock market closed higher with investors relieved that the midterm elections produced a clear result.
The Dow Jones and S&P 500 hit fresh records.
Sentiment was also boosted by an upbeat jobs survey, raising hopes that the official payroll figures on Friday will be strong.
The Dow Jones closed after adding 100.69 points at 17,484.53.
The broad-based S&P 500 rose 11.47 points to 2,023.57 while the NASDAQ lost early gains and fell 2.91 points to 4,620.72.
The US stock market closed higher with investors relieved that the midterm elections produced a clear result (photo Reuters)
Energy shares rose on hopes that the Republican majority in the Senate could lead to new energy-friendly legislation.
The midterm vote also boosted the dollar, which jumped to a seven-year high against the yen of 114.65 yen.
Meanwhile, investors were impressed by a report from payroll processor ADP which said that private firms in the US added 230,000 jobs in October. This was ahead of forecasts and the largest increase since June.
Among individual firms, shares in TripAdvisor dived 14% after the travel review website’s third quarter results fell short of expectations.
Net income for the quarter fell to $54 million from $56 million a year earlier, following a big increase in marketing costs.
Time Warner shares rose 4% after its third quarter profit and revenue beat expectations. It posted net income of $967 million with revenue up 3.3% to $6.24 billion.
World’s markets have staged a partial recovery after a week of precipitous falls and volatility.
London’s FTSE 100 index was up over 1% in mid-afternoon trading, while Germany’s DAX was up 1.76% and France’s Cac 40 was up more than 2%.
On Wall Street, the Dow Jones index opened nearly 1% higher after better-than-expected US industrial production data helped steady the ship.
Fears over a weakening global economic outlook had unsettled investors.
World’s markets have staged a partial recovery after a week of precipitous falls and volatility
The FTSE 100 had fallen 10% since early September, wiping £175bn off the value of listed businesses.
Steven Saywell, head of foreign exchange strategy at BNP Paribas, said the real concern over the faltering eurozone economy was inflation, currently running at 0.3%.
“We believe the risk is it could fall even further,” he said.
BNP Paribas believes European Central Bank president Mario Draghi should take bold measures to buy sovereign bonds in an attempt to convince investors that the rate of inflation would increase.
US and European stock markets have fallen over concerns about the health of one of Portugal’s biggest banks.
Shares in Banco Espirito Santo were suspended after falling 17% following concerns about accounting irregularities at its parent group.
As a result, the Lisbon stock exchange fell more than 4%, Madrid’s IBEX was down 2.7%, while the Paris CAC 40 and Frankfurt’s DAX were both 1.8% lower.
Wall Street also opened sharply lower, with the Dow Jones falling 150 points.
This took the index well below 17,000, the level breached for the first time earlier this month.
US and European stock markets have fallen over concerns about the health of Portugal’s Banco Espirito Santo
Media reports highlighting concerns about certain financial practices at the Espirito Santo group surfaced at the end of last year.
Portugal’s central bank then ordered an audit into the group’s accounts, which uncovered “serious” accounting irregularities.
The Portuguese government has said that Banco Espirito is isolated from problems at its parent, which is registered in Luxembourg, and that public finances are not at risk.
At the height of the financial crisis, Portugal was forced to take a 78 billion euro ($106 billion) bailout from its European partners and the International Monetary Fund (IMF).
Portugal exited the bailout program last month as confidence in the country’s economy returned.
Government borrowing costs fell to an eight-year low of 3.58% in April this year, but renewed concerns about the health of the country’s financial sector pushed these back up towards 4% on Thursday.
Some commentators suggested the specific concerns about Banco Espirito fed into wider fears about the health of the eurozone economy.
Stock markets dipped in early Monday trading as fresh data presented a mixed economic picture in the US.
US consumer price inflation rose 0.4% month-on-month in April, twice as much as analysts had expected, while new home starts fell 6.5%.
Stock markets dipped in early Monday trading as fresh data presented a mixed economic picture in the US
The Dow Jones was down 30.28 points, or 0.18%, at 16,750.73 and the tech-heavy NASDAQ fell 4.84 points, or 0.11%, to 4,316.27.
The S&P 500 dropped 3.19 points, or 0.16%, to 1,934.59.
Markets were also nervous as the Federal Reserve Open Markets Committee began a two-day monetary policy meeting.
Forest Oil Corp was the biggest gainer, up 10.5%, after it emerged that a deal for the company to be taken over by Sabine Oil & Gas was going ahead, despite earlier reports to the contrary.
US shares closed at record levels, helped by strong data on the manufacturing sector.
The Dow Jones rose 26 points to close at 16,743, its second consecutive record close.
The broader S&P 500 added just a point, but that was enough to secure its third consecutive record session.
US factories remained busy in May, according to the manufacturing activity index compiled by the Institute for Supply Management (ISM).
US shares closed at record levels, helped by strong data on the manufacturing sector (photo AP)
The ISM had to correct its original release which showed slowing activity, but had been calculated incorrectly.
“The market has lately been focused more on the weak economic news and the bond market, but we saw a reversal of that today with the revised [ISM] numbers,” said Rick Meckler, president of hedge fund LibertyView Capital Management in Jersey City, New Jersey.
“But it’s hard to move the market higher, considering we are fairly fully valued at this point,” he said.
The technology focused NASDAQ fell 10 points to close at 4,237.
Shares in Botox-maker Allergan soared 9% after Valeant Pharmaceuticals said it would go hostile with its bid for the company.
Activist investor, Bill Ackman, who is partnering with Valeant in the bid, said he would move to replace almost the entire board of Allergan.
Equipment maker Caterpillar was the biggest winner among the Dow Industrials, rising 1.5%.
Technology giant Intel also had a strong session, adding 1.1%.
On the NASDAQ, Broadcom shares rose over 10% after the company said it would look for a buyer for its division that makes chips used in mobile devices.
Dow Jones index rose above 16,000 points for the first time and the broader Standard and Poor’s passed through the 1,800.
Traders are optimistic about the prospect of the Federal Reserve continuing its cheap money policy.
Lower interest rates mean investors are driven to find investments where they will gain higher returns.
Interest rates are close to nothing in the US and are expected to stay there.
Dow Jones index rose above 16,000 points for the first time and the broader Standard and Poor’s passed through the 1,800
Although the current chairman of the Federal Reserve, Ben Bernanke, is leaving the post, Janet Yellen, who is all but certain to take over from him, is expected to keep the money flowing while the US economy remains fragile.
The economy is growing, but is not thought to be on solid enough ground to withstand the shock that could be caused by a change in policy.
Earlier this month, it was announced that the US economy grew at a better-than-expected annual pace of 2.8% in the third quarter.
However, the latest figures also showed that the unemployment rate edged up to 7.3% from 7.2% in September.
The gains that put stocks in record grounds were modest.
The Dow Jones was up 39.7 points at 16,001.4 points.
The Standard and Poor’s was up 2 points at 1,800.40 points.
Most Asian markets have fallen again as investors continue to react to news that the Federal Reserve could begin to scale back its stimulus programme.
South Korea’s main index dropped 1.5% while Australia’s lost 0.4%. However, Japan’s Nikkei reversed early losses.
The indexes in Shanghai and Hong Kong were down more than 2% in early trade but pared losses.
On Thursday in the US, the Dow Jones share index fell 2.3% – its biggest drop this year.
The Fed has been trying to support the weak US economy by buying bonds at a rate of $85 billion a month, under a policy known as quantitative easing (QE).
However, on Wednesday, Fed chairman Ben Bernanke said that if the US economy continued to show sign of improvement the central bank could start to slow down its bond purchases as early as this year and end the programme next year.
Most Asian markets have fallen again as investors continue to react to news that the Federal Reserve could begin to scale back its stimulus programme
The excess liquidity in the US has meant a lot of funds have been flowing into emerging markets, especially in Asia.
“Asia has benefited from US capital inflows, partly in relation to QE,” said Mitul Kotecha, from Credit Agricole CIB.
“It has been force-fed with steroids, and now that the steroids are going to be pulled back what will happen is a period of transitional volatility that can continue through summer.”
Currencies in Asia were weak as well against the US dollar, however the weakness in the Japanese yen caused a big reversal in the Nikkei in late trade.
The Nikkei, which had sank more than 2% during the morning trading session, finished 1.7% higher.
A weak yen is good news for Japanese exporters as it makes their goods cheaper overseas and boosts profits that are repatriated back home.
Exporters led the gains with Suzuki Motor jumping nearly 4% and Fast Retailing surging more than 6%.
Asian markets have dropped in early trading after two explosions hit the Boston Marathon finishing line killing three people and injuring dozens more.
Stock indexes fell by as much as 2% in Japan. South Korea and Australia also dropped, as did oil and gold prices.
Earlier on Monday, US markets closed lower after the blasts accelerated a sell-off started by weak economic data.
Analysts said that investors would be more risk averse in coming sessions and would focus on Asia’s problem areas.
“This is a kind of unknown-unknown event and a stark reminder that the world continues to remain unsafe,” said Vishnu Varathan of Japanese bank Mizhuo.
“While it has happened far away from Asia, it is likely to trigger concerns and fears over Asia’s known-unknowns.
“You have the Korean peninsula tensions, the territorial dispute between China and Japan, and other issues in the China Sea which all pose risks if they flare up,” he added.
Asian markets have dropped in early trading after two explosions hit the Boston Marathon finishing line killing three people and injuring dozens more
Faced with these problems, investors reacted to the news of the blasts by trying to cut risks, not least because in recent weeks stock markets in Asia have seen strong gains.
Japan’s Nikkei 225 index was recently trading 1% lower, while South Korea’s Kospi was down 0.9% and Australia’s ASX 200 shed 0.8%.
In the US, all three of the country’s main stock indexes closed lower on Monday. The Dow Jones ended the day down 1.8%, while the S&P shut 2.3% lower and the Nasdaq shed 2.4%.
Oil prices dropped in Asia, with US light crude down by 1.9%, and Brent crude sliding 1.6%. Gold continued to fall, extending Monday’s 10% fall and continuing to hit its lowest levels in two years.
By contrast, the Japanese yen gained against the US dollar because many investors see it as a less risky asset.
“The developments in Boston are likely to trigger an initial reaction of caution,” said Michael McCarthy, chief market analyst at CMC Markets.
The Japanese currency rose as much as 2.5% to 96.61 yen against the US dollar in New York on Monday. It also gained nearly 3% against the euro, rising as high as 125.98 yen against the single European currency.
Analysts said that many large Japanese banks or pension funds tended to sell riskier assets during times of uncertainty, bringing the money back into the country, resulting in an appreciation in the yen’s value.
Knowing this, other global investors also buy the yen, or yen-denominated assets, to benefit from this gain. However, once the risks recede, then investors tended to sell their yen and use the proceeds to again invest in riskier assets.
Analysts said the blasts had further dented investor morale in both Asia and elsewhere, which had already been shaken by weaker-than-expected Chinese and US data.
They also pointed to a number of potential Asian flashpoints that caused investors to be cautious, such as the heightened tensions on the Korean peninsula.
North Korea has recently conducted a nuclear test, and in recent weeks it has also threatened to attack South Korea, Japan and US bases in the region.
Meanwhile, the spat between China and Japan over a set of disputed islands in the East China Sea has flared up. The issue is yet to be resolved and continues to remain a bone of contention between Asia’s two biggest economies.
Analysts have often have warned that an escalation of any of these issues was likely to hurt the region’s economic growth.
“Asia is increasingly relying on intra-regional trade to sustain its economic growth,” said Vishnu Varathan of Mizhuo.
“Any full-blown conflict between Asian nations will hurt trade and could adversely impact economic growth.”
Asian stock markets have continued a global rally after New York’s main Dow Jones share index hit a historical record high.
Equity markets in Asia, the US and Europe have been buoyed by central bank attempts to revive economic growth by pumping cash into the financial system.
Analysts said that this has helped ease fears of continuing political problems and slower corporate profit growth.
In Asia on Wednesday, the main indexes in Japan and Australia hit their highest levels since September 2008.
Japan’s Nikkei was 1.1% higher in early trading while Australian shares were up 0.9%. Shares in Hong Kong, Shanghai and Singapore also posted gains.
The dollar eased 0.2% against a basket of key currencies while copper and crude oil prices rose.
The rally on Wall Street means the main US indexes have erased the losses brought on by the global financial crisis.
Dow Jones closed at 14,256 after investors were buoyed by signs of recovery in the US housing market in recent months, and data showing growth in the services sector.
The share index ended the day more than double its low of 6,547 in March 2009.
London’s FTSE 100 closed at a five-year high on Tuesday.
Analysts said sentiment was being boosted mainly because of the stimulus programs being conducted by the US, Europe and Japan.
Asian stock markets have continued a global rally after New York’s main Dow Jones share index hit a historical record high
In the US, Federal Reserve chairman Ben Bernanke has engaged in a campaign of massive bond-buying while keeping interest rates at a record low to help support the world’s largest economy after the global financial crisis in 2008.
The program known as quantitative easing or QE3, is in its third phase, and has been made open ended.
“To be sure, it was Bernanke’s reassurance, at last week’s congressional testimonies on monetary policy, to keep QE3 on its present course that turned a worried stock market into a record high,” said analysts at DBS Bank in Singapore.
The European Central Bank and the Bank of Japan have also taken steps to boost liquidity.
However, despite the positive sentiment on the markets analysts said there were risks on the horizon.
China’s move to curb high property prices, the impact of the US spending cuts as well uncertainty after the elections in Italy could still weigh on investors.
These concerns, however, are for now being overshadowed by the notion that central banks will continue to support the fragile global economic recovery.
“That’s fantastic testament to the power of easy money, in the face of doubts about the US economy now that fiscal spending is being cut back,” said Kit Juckes, from Societe Generale.
The European Central Bank, the Bank of Japan and the Bank of England will hold their policy meetings on Thursday.
Most analysts expect the three central banks to continue their policies aimed at spurring growth in their economies.
Asian markets have risen, following gains on Wall Street, after the US Federal Reserve unveiled its latest stimulus plan.
The US central bank said it would buy $40 billion of mortgage debt a month and kept interest rates at below 0.25%.
It said it would also continue its programme to reduce long-term borrowing costs for firms and households.
Japan’s Nikkei 225 index rose 1.8%, South Korea’s Kospi gained 2.6% and Hong Kong’s Hang Seng added 2.5%.
This followed gains of 1.6% rise in the Dow Jones and S&P 500 indexes on Thursday.
Asian markets have risen, following gains on Wall Street, after the US Federal Reserve unveiled its latest stimulus plan
Investors are hoping the measures will revive growth in the US economy, the world’s biggest, and a key market for Asian exports.
“They’re saying that the punch bowl, the fuel for the economy, isn’t going away – it’s going to be here as long as you need it,” said Tony Fratto, managing partner at Hamilton Place Strategies, a policy consulting firm.
There have been growing fears about the global economy with a weak recovery in the US and the ongoing debt crisis in the eurozone.
The slowdown in China’s economy, the world’s second-largest, and one of its biggest drivers of growth after the global financial crisis, has fanned those fears.
Prompted by these concerns, policymakers in these regions have been taking measures to try to spur a fresh wave of growth.
The Federal Reserve’s announcement came days after the European Central Bank (ECB) announced its latest plan.
Last week, the ECB said that it would buy bonds from the bloc’s debt-ridden nations in an attempt to bring down their borrowing costs.
Meanwhile, China has cut its interest rates twice since June to bring down borrowing costs for businesses and consumers. Beijing has also lowered the amount of money that banks need to keep in reserve three times in the past few months to further encourage lending.
This week South Korea has also unveiled two stimulus measures aimed at boosting domestic demand and helping small businesses.
Analysts said the moves had helped reassure investors and markets that policymakers were doing all they could to ensure growth in the global economy.
“You’re witnessing global economic stimulus across the board,” said Quincy Krosby, a market strategist at Prudential Financial.
“The Fed’s actions are occurring in conjunction with the European Central Bank’s commitments to support the euro and amid talk that China could also deliver a stimulus package.”
World markets are down as Greece’s continuing political uncertainty undermines confidence.
Greece failed to form a coalition government through talks on Sunday and will continue discussions with political leaders on Monday evening.
Bank shares are worst hit, particularly in Spain and France, with Madrid’s IBEX index down 3% and the CAC down 2.7%.
The Dow Jones has opened 1% lower while London’s 100 share index is down 2%.
Germany’s DAX is down 2.5%.
The undermining factor is again the future of the eurozone.
Eurozone finance ministers are meeting in Brussels to discuss the situation in Greece and Spain.
World markets are down as Greece's continuing political uncertainty undermines confidence
Irish Finance Minister Michael Noonan expressed his support for Greece’s place within the eurozone: “We are not planning a Greek exit, that’s not our business.
“My view is that Greece should continue to stay in the euro, and any support I can give them at the meetings over the next two days to achieve that objective I will do so.”
But he warned that any new Greek government must stick to the austerity plan already agreed.
French banks were among the biggest fallers as investors worried about their exposure to other troubled eurozone countries.
Losses worsened throughout the session leaving BNP Paribas, Societe Generale and Credit Agricole down almost 5%.
Spain’s Banco Santander was also down almost 5% while part-nationalized Bankia lost more than 9%.
They said they would set aside an extra 2.7 billion Euros and 2.1 billion Euros respectively to meet new government requirements aimed at cleaning up the country’s ailing property market.
The price of oil also fell on fears about weakening economic activity.
Brent crude fell $1.69 to $110.57 a barrel. In March, it was $128 a barrel.
US crude fell $1.86 to $94.27.
Meanwhile, both Spain and Italy carried out successful bond auctions on Monday.
Appetite for Spanish and Italian debt was more than strong enough, but the return demanded by investors in Spain’s debt was higher than in previous auctions, reflecting a dip in confidence.
Spain sold 2.9 billion Euros in short-term debt, paying 2.985%, up from 2.623% last time.
The difference in the rate demanded by Spanish 10-year bond investors over the equivalent German bunds hit 4.83%, its highest level since the creation of the euro.
The yield, or interest rate, on Spain’s key 10-year bonds, which are traded on the market, jumped 23 basis points to a record high of 6.22%.
Italy raised 5.25 billion Euros, paying a yield of 3.91%, almost unchanged on the previous rate of 3.89%.
Greece’s lack of a government puts in doubt its ability to stick to austerity measures imposed as part of its financial bailout. Without holding to agreed cuts it will not get the rest of the support funds it needs to function.
Adding to the lack of clarity is the fact that anti-bailout parties did well in the elections.
Anti-austerity feeling may be growing in Germany too after Chancellor Angela Merkel’s party suffered a defeat on Sunday in an election in North Rhine-Westphalia, the country’s most populous state.
On top of that, new French President Francois Hollande won his place after promising to focus more on growth rather than austerity, raising concerns as to whether he will be able to work as closely with Angela Merkel as his predecessor Nicolas Sarkozy did.
The two were the driving force behind the eurozone’s fiscal compact.
[googlead tip=”vertical_mic”]Asian financial markets continued their decline on Tuesday, after a Monday black day performed by American and European stock markets.
Asian financial markets continued their decline on Tuesday, after a Monday black day performed by American and European stock markets, despite the mobilization of leaders and governors of central banks were trying to calm the markets concerns regarding the specter of a new crisis, according to AFP.
Hong Kong SE fell by 7.24%
Tokyo Stock Exchange registered a fall of over 4% in mid-session, the stock exchange in Hong Kong fell by 7.24% after session opening, the Sydney Stock Exchange registered a 5% lost and Seoul a 4.2% lost.
Hong Kong SE fell by 7.24% shortly after session opening
[googlead tip=”vertical_mediu” aliniat=”dreapta”] “Asians are acting emotionally instead of looking rationally at the situation. It is a general panic, ” said Chris Weston from IG Markets, based in Melbourne.
Oil quotations continued to drop.
Oil quotations continued to drop during electronic trades conducted on Asian markets, a barrel of oil “light sweet crude” with delivery in September fell below $80 while Brent crude oil barrel tested the threshold of 100 dollars.
Gold price reached a new high record in Hong Kong.
Gold continues to enjoy its status of value of refuge. Tuesday, an ounce of gold reached a new high record on Hong Kong Stock Exchange, 1,726.30-1,727.30 dollars after Monday 1720 dollars threshold.
Financial markets still suffer from the shockwaves of the last Friday historic decision when Standard and Poor’s has downgraded the U.S. “AAA” rating to “AA+”.
The S & P’s decision came along with a huge list of disappointing U.S. economic indicators and the fears about sovereign debt crisis evolution in Europe.
[googlead tip=”lista_mare” aliniat=”stanga”]Yesterday, the New York Stock Exchange recorded the worst session since December 2008. The Dow Jones fell 5.55% to end below 11,000 for the first time in the last 10 months. Panic has spread to the other side of the Atlantic. Frankfurt Stock Exchange fell by 5.02%, Paris dropped by 4.68% and London ended down 3.39%.
Pressed to come up with a concerted response to the euro area crisis and to the signs of slowing U.S. economy, the world’s richest countries leaders were not spared. Monday morning, shortly before the opening of European markets sessions, the G20 said they were ready to act in a coordinated manner to stabilize financial markets and protect economic growth. A little later, leaders and central bank governors from G7 said they would cooperate to counter excessive exchange rate movements. In its turn, the European Central Bank announced Sunday that it will purchase public bonds from secondary market.
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