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| Version 4 | Version 5 |
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| Fears drag down European markets | Fears drag down European markets |
| (40 minutes later) | |
| European stock markets showed heavy losses in early afternoon trading as fears of a global recession continued to rattle investors' confidence. | European stock markets showed heavy losses in early afternoon trading as fears of a global recession continued to rattle investors' confidence. |
| In London, the benchmark FTSE index was down by 3.9%, while France and Germany, the Cac and Dax were 3.2% and 3.3% lower respectively. | In London, the benchmark FTSE index was down by 3.9%, while France and Germany, the Cac and Dax were 3.2% and 3.3% lower respectively. |
| The falls reflect losses in the Asian markets, where South Korea's index fell 5.1% to close at a three-year low. | The falls reflect losses in the Asian markets, where South Korea's index fell 5.1% to close at a three-year low. |
| Other Asian shares fell on fears a US recession would hit the global economy. | Other Asian shares fell on fears a US recession would hit the global economy. |
| Commodity falls | Commodity falls |
| On Tuesday evening, the governor of the Bank of England, Mervyn King, warned that Britain was probably entering its first recession in 16 years. | On Tuesday evening, the governor of the Bank of England, Mervyn King, warned that Britain was probably entering its first recession in 16 years. |
| "In the short term, the comments made by Mervyn King highlighting the fact that the economic environment has deteriorated quite rapidly over the past year have sent a shudder through the foreign exchange and equity markets," said Henk Potts, an equity strategist at Barclays Wealth. | "In the short term, the comments made by Mervyn King highlighting the fact that the economic environment has deteriorated quite rapidly over the past year have sent a shudder through the foreign exchange and equity markets," said Henk Potts, an equity strategist at Barclays Wealth. |
| "There's been a housing slump, the labour market has been suffering and business confidence has been hammered - it's no surprise that investors are spooked," he added. | "There's been a housing slump, the labour market has been suffering and business confidence has been hammered - it's no surprise that investors are spooked," he added. |
| Stocks were also dragged down by commodity stocks tracking weaker oil and copper prices. | Stocks were also dragged down by commodity stocks tracking weaker oil and copper prices. |
| On Tuesday, Wall Street's Dow Jones index sank 2.5% after several US firms reported weak earnings figures. | On Tuesday, Wall Street's Dow Jones index sank 2.5% after several US firms reported weak earnings figures. |
| The firms, such as Caterpillar and DuPont, were also cautious about their prospects. | The firms, such as Caterpillar and DuPont, were also cautious about their prospects. |
| Widespread sell-off | Widespread sell-off |
| In early afternoon trading, the FTSE index was down 166.34 points, or 3.93%, at 4063.39 points. The Cac 40 was also down, shedding 114.09 points, or 3.28% to 3361.31 points, while the Dax slumped 161.70 points, or 3.38%, at 4622.71 points. | In early afternoon trading, the FTSE index was down 166.34 points, or 3.93%, at 4063.39 points. The Cac 40 was also down, shedding 114.09 points, or 3.28% to 3361.31 points, while the Dax slumped 161.70 points, or 3.38%, at 4622.71 points. |
| Richard Hunter, head of UK Equities at Hargreaves Lansdown Stockbrokers, said attention had turned from a banking crisis - which was now considered to have been largely averted - to the possibility of recession. | Richard Hunter, head of UK Equities at Hargreaves Lansdown Stockbrokers, said attention had turned from a banking crisis - which was now considered to have been largely averted - to the possibility of recession. |
| "Interest rates are likely to be cut but it won't stop the fact that the UK is likely to go into recession, as the US probably is," said Mr Hunter. | "Interest rates are likely to be cut but it won't stop the fact that the UK is likely to go into recession, as the US probably is," said Mr Hunter. |
| "The question is, how long and deep will it be?" | "The question is, how long and deep will it be?" |
| He said UK GDP figures, due to be released on Friday, were likely to be in negative territory and the market was "steeling itself". | He said UK GDP figures, due to be released on Friday, were likely to be in negative territory and the market was "steeling itself". |
| Earlier, Japan's benchmark Nikkei fell 631.56 points, or 6.8%, to close at 8,674.69 - its biggest one-day loss in percentage terms since last Thursday, when it fell 11%. The broader Topix index fell 7.1% to close at 889.23. | Earlier, Japan's benchmark Nikkei fell 631.56 points, or 6.8%, to close at 8,674.69 - its biggest one-day loss in percentage terms since last Thursday, when it fell 11%. The broader Topix index fell 7.1% to close at 889.23. |
| The Korea Composite Stock Price Index closed at 1,134.59 points, the lowest close since early autumn 2005, and had touched a low of 1,095.56 earlier in the day. | The Korea Composite Stock Price Index closed at 1,134.59 points, the lowest close since early autumn 2005, and had touched a low of 1,095.56 earlier in the day. |
| In other Asian markets, Singapore's benchmark index fell 5% to a four-year low, as banking and property shares slid on worries the global economy is heading for a recession. | In other Asian markets, Singapore's benchmark index fell 5% to a four-year low, as banking and property shares slid on worries the global economy is heading for a recession. |
| In India, the main BSE Index closed down 513.49 points, or 4.81%, at 10,169.90 points. | |
| Similar concerns pushed the share index in Australia down 3.4%. | Similar concerns pushed the share index in Australia down 3.4%. |
| "Now the banking issues has been resolved, the market is focusing on fundamentals. There are also fears that [company] earnings will be down and that guidance will be lowered," said Cantor Fitzgerald Europe equities analyst Florent Hunsinger. | |
| "The credit crisis is devastating and has done a lot of damage in the real economy," he said. | |
| FTSE 100 INDEX: 22 October 2008*All Times GMT | FTSE 100 INDEX: 22 October 2008*All Times GMT |