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Version 8 | Version 9 |
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European markets tumble on open | European markets tumble on open |
(10 minutes later) | |
Stock markets across Europe have fallen steeply on opening after earlier dramatic share price falls in Asia. | Stock markets across Europe have fallen steeply on opening after earlier dramatic share price falls in Asia. |
The FTSE 100 share index plunged 9.8% to 3887 points, the first time it has fallen below 4,000 points in five years. | |
There were similar falls across Europe - Paris was down 9% while Germany was down 9.6%. | There were similar falls across Europe - Paris was down 9% while Germany was down 9.6%. |
Earlier Tokyo's Nikkei index dropped 9.6% while shares in Australia, Hong Kong and Singapore all plummeted. | |
Despite concerted government action, investors are increasingly fearful the financial crisis will prompt a global recession. | Despite concerted government action, investors are increasingly fearful the financial crisis will prompt a global recession. |
Finance ministers from the G7 leading industrial countries are set to meet in Washington to discuss the crisis. | Finance ministers from the G7 leading industrial countries are set to meet in Washington to discuss the crisis. |
US President George W Bush is due to make an address to the American people later in the day. | US President George W Bush is due to make an address to the American people later in the day. |
'Deeper panic' | 'Deeper panic' |
Heavy falls were seen across Asia's markets as a climate of fear took hold on Friday. | |
In India, the Mumbai market plunged 6.5% in early trading. | |
Selling is unstoppable in New York and Tokyo. Investors were gripped by fear Yutaka MiuraShinko Securities | |
In Japan as the Nikkei index slumped in its biggest one-day fall since the 1987 stock market crash, the crisis claimed its first Japanese financial institution, with the insurance company Yamato Life going bankrupt. | |
"Selling is unstoppable in New York and Tokyo," said Yutaka Miura, senior strategist at Shinko Securities in Tokyo. | "Selling is unstoppable in New York and Tokyo," said Yutaka Miura, senior strategist at Shinko Securities in Tokyo. |
"Investors were gripped by fear." | "Investors were gripped by fear." |
At the end of trading on Friday, Tokyo shares had plunged 24% during the week - double their weekly fall during the 1987 market crash. | At the end of trading on Friday, Tokyo shares had plunged 24% during the week - double their weekly fall during the 1987 market crash. |
FROM THE TODAY PROGRAMME More from Today programme | FROM THE TODAY PROGRAMME More from Today programme |
Elsewhere in Asia was a similar story. | Elsewhere in Asia was a similar story. |
Australian shares closed down 8.3%, Hong Kong's benchmark Hang Seng index slumped to a three-year low, in the Philippines, share prices closed down more 8.3% while Shanghai's index was down 3.8%. | Australian shares closed down 8.3%, Hong Kong's benchmark Hang Seng index slumped to a three-year low, in the Philippines, share prices closed down more 8.3% while Shanghai's index was down 3.8%. |
In Indonesia, plans to re-open the stock market were suspended in order to prevent what the president of the exchange called "deeper panic". Trading was halted for two days earlier this week. | In Indonesia, plans to re-open the stock market were suspended in order to prevent what the president of the exchange called "deeper panic". Trading was halted for two days earlier this week. |
'Beyond fundamentals' | 'Beyond fundamentals' |
As well as the G7 meeting, talks will be held at the International Monetary Fund (IMF) in Washington. | As well as the G7 meeting, talks will be held at the International Monetary Fund (IMF) in Washington. |
The IMF has said it is ready to lend to countries hit by the global credit crunch, using an emergency lending procedure first used in the 1990s Asian crisis. | The IMF has said it is ready to lend to countries hit by the global credit crunch, using an emergency lending procedure first used in the 1990s Asian crisis. |
The organisation's chief, Dominique Strauss-Khan, said on Thursday this would allow the IMF to react quickly to support countries facing funding problems. | The organisation's chief, Dominique Strauss-Khan, said on Thursday this would allow the IMF to react quickly to support countries facing funding problems. |
The IMF has warned the financial crisis is the most dangerous since the 1930s | The IMF has warned the financial crisis is the most dangerous since the 1930s |
Mr Strauss-Kahn said the world was "on the cusp of recession", but could still recover. | Mr Strauss-Kahn said the world was "on the cusp of recession", but could still recover. |
The IMF has about $200bn immediately available to lend to countries in need but can tap other sources. | The IMF has about $200bn immediately available to lend to countries in need but can tap other sources. |
The Dow Jones - the US benchmark index - ended down 7.3% on Thursday - tumbling below 9,000 points for the first time since August 2003. | The Dow Jones - the US benchmark index - ended down 7.3% on Thursday - tumbling below 9,000 points for the first time since August 2003. |
"We're way beyond fundamentals," said Chris Orndorff, head of equity strategy at Payden & Rygel, in Los Angeles. | "We're way beyond fundamentals," said Chris Orndorff, head of equity strategy at Payden & Rygel, in Los Angeles. |
"This is just pure panic, that's all it is." | "This is just pure panic, that's all it is." |
Iceland mission | Iceland mission |
The IMF has already sent a mission to Iceland, where the government has taken control of its three biggest banks. | The IMF has already sent a mission to Iceland, where the government has taken control of its three biggest banks. |
There is no domestic solution to a crisis like this one Dominique Strauss-Kahn, IMF managing director Time to reform the IMF?'Major global downturn' says IMFStocks falter as fears persistRobert Peston's blog | There is no domestic solution to a crisis like this one Dominique Strauss-Kahn, IMF managing director Time to reform the IMF?'Major global downturn' says IMFStocks falter as fears persistRobert Peston's blog |
Speaking ahead of meetings of the IMF and World Bank, Mr Strauss-Khan urged countries to act "quickly, forcefully, and co-operatively" to solve the global economic problems. | Speaking ahead of meetings of the IMF and World Bank, Mr Strauss-Khan urged countries to act "quickly, forcefully, and co-operatively" to solve the global economic problems. |
He said further co-ordinated action was necessary to calm financial markets: "All kinds of policy co-operation are to be commended". | He said further co-ordinated action was necessary to calm financial markets: "All kinds of policy co-operation are to be commended". |
But he issued a stark warning against countries acting unilaterally to fight the crisis, referring to recent isolated moves by certain European Union member countries. | But he issued a stark warning against countries acting unilaterally to fight the crisis, referring to recent isolated moves by certain European Union member countries. |
"There is no domestic solution to a crisis like this one." | "There is no domestic solution to a crisis like this one." |
Finance ministers from the G7 group of wealthy nations are to meet in Washington this weekend. | Finance ministers from the G7 group of wealthy nations are to meet in Washington this weekend. |