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Markets slide on inflation fears | Markets slide on inflation fears |
(about 3 hours 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. | 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 2.6% while the Cac40 fell 2.1% and the Dax 1.6%. | In Europe, the FTSE 100 fell 2.6% while the Cac40 fell 2.1% and the Dax 1.6%. |
But in New York the Dow Jones Industrial Average bucked the trend, ending the day up 0.28%. | |
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." |
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. |