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| Markets slide on inflation fears | |
| (10 minutes later) | |
| Inflation worries, near-record oil prices and fears of further bank losses have led to a sell-off of shares across global stock markets. | |
| Key share indexes in India and China both fell 3% while Japan's main index fell for its ninth consecutive day for the first time in four years. | Key share indexes in India and China both fell 3% while Japan's main index fell for its ninth consecutive day for the first time in four years. |
| In Europe, the FTSE 100 fell 2% while Paris and Frankfurt saw similar losses. | In Europe, the FTSE 100 fell 2% while Paris and Frankfurt saw similar losses. |
| Lack of confidence also hit US markets, with the Dow Jones Industrial Average opening down more than 100 points. | |
| Banking and airline shares were especially weak, the former hit by talk of further sub-prime related losses. | Banking and airline shares were especially weak, the former hit by talk of further sub-prime related losses. |
| Bank rumours | Bank rumours |
| Swiss bank UBS, which has been one of the biggest victims of the widespread financial crisis caused by the US housing slump, reshuffled its management on Tuesday. | Swiss bank UBS, which has been one of the biggest victims of the widespread financial crisis caused by the US housing slump, reshuffled its management on Tuesday. |
| This sparked speculation that the firm, which has announced plans to cut more than 5,000 jobs, could be set to announce further losses from failed mortgage-backed investments. | This sparked speculation that the firm, which has announced plans to cut more than 5,000 jobs, could be set to announce further losses from failed mortgage-backed investments. |
| It has already incurred losses of more than $37bn. | It has already incurred losses of more than $37bn. |
| We haven't hit the bottom yet... investors are still pessimistic at this point Zhang Xiuqi, Guotai Junan Securities Follow key share indices | We haven't hit the bottom yet... investors are still pessimistic at this point Zhang Xiuqi, Guotai Junan Securities Follow key share indices |
| "There is more concern coming back in on the banking sector again," said Andrea Williams, head of European equities at Royal London Asset Management. | "There is more concern coming back in on the banking sector again," said Andrea Williams, head of European equities at Royal London Asset Management. |
| "There are a lot of rumours about writedowns." | "There are a lot of rumours about writedowns." |
| In London, the FTSE 100 index was down 140.7 points at 5,485.2 by early afternoon. | In London, the FTSE 100 index was down 140.7 points at 5,485.2 by early afternoon. |
| Banks and airline stocks were particularly weak, with British Airways down nearly 5% after oil prices rebounded back above $142 a barrel. | Banks and airline stocks were particularly weak, with British Airways down nearly 5% after oil prices rebounded back above $142 a barrel. |
| Air France shares fell 3.4% in Paris, contributing to a 105.31 point drop in the benchmark Cac 40 index to 4,329.54. | Air France shares fell 3.4% in Paris, contributing to a 105.31 point drop in the benchmark Cac 40 index to 4,329.54. |
| In Frankfurt, the Dax index was down 131.71 points at 6,286.61. | In Frankfurt, the Dax index was down 131.71 points at 6,286.61. |
| Earlier, Asian stock markets were hit by concerns that rising inflation, stoked by higher prices for oil and raw materials, would eat into company profits and slow economic growth. | Earlier, Asian stock markets were hit by concerns that rising inflation, stoked by higher prices for oil and raw materials, would eat into company profits and slow economic growth. |
| In India, where inflation is at a 13-year high, the main Sensex index in Bombay slid 3.7% to 12,961.68. Shanghai's main index. meanwhile, fell 3.1% to 2,651.6, a 16-month low. | In India, where inflation is at a 13-year high, the main Sensex index in Bombay slid 3.7% to 12,961.68. Shanghai's main index. meanwhile, fell 3.1% to 2,651.6, a 16-month low. |
| "We haven't hit the bottom yet," warned Zhang Xiuqi, from Guotai Junan Securities. | "We haven't hit the bottom yet," warned Zhang Xiuqi, from Guotai Junan Securities. |
| "That is because investors are still pessimistic at this point." | "That is because investors are still pessimistic at this point." |
| Losses in Japan were limited despite the closely watched Tankan survey of corporate prospects showing that business confidence had fallen to a five-year low. | Losses in Japan were limited despite the closely watched Tankan survey of corporate prospects showing that business confidence had fallen to a five-year low. |