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You can find the current article at its original source at http://www.theguardian.com/business/2014/oct/15/global-markets-tumble-on-new-fears-of-economic-slowdown-ftse-dow-jones
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Global markets tumble on new fears of economic slowdown | Global markets tumble on new fears of economic slowdown |
(about 1 hour later) | |
Global markets suffered sharp falls again as investor fears of an economic slowdown were reinforced by a poor set of US data. | Global markets suffered sharp falls again as investor fears of an economic slowdown were reinforced by a poor set of US data. |
The Dow Jones Industrial Average has dropped 309 points or 1.7% in early trading to 15,994, compared to its recent high of 17,265 reached on 18 September - the day before the record breaking Alibaba float. | The Dow Jones Industrial Average has dropped 309 points or 1.7% in early trading to 15,994, compared to its recent high of 17,265 reached on 18 September - the day before the record breaking Alibaba float. |
In the UK the FTSE 100 is 131 points or 2% lower at 6261.68 - close to the 10% from its recent peak on 4 September which would mark an official correction. | In the UK the FTSE 100 is 131 points or 2% lower at 6261.68 - close to the 10% from its recent peak on 4 September which would mark an official correction. |
Germany’s Dax has dropped 2% while France’s Cac is down 2.6%. The Vix volatility index, linked to the S&P 500, has jumped 15%, its highest for more than two years. | Germany’s Dax has dropped 2% while France’s Cac is down 2.6%. The Vix volatility index, linked to the S&P 500, has jumped 15%, its highest for more than two years. |
The latest catalyst was figures indicating the US economy could be the latest to be hit by a global fall in demand. US retail sales fell 0.3% in September, the first decline since January, and worse than the 0.1% decline expected., while producer prices fell by 0.1%, the first decline since August 2013. Meanwhile the Empire manufacturing report for New York fell to 6.17 this month, from 20.5 in September. | The latest catalyst was figures indicating the US economy could be the latest to be hit by a global fall in demand. US retail sales fell 0.3% in September, the first decline since January, and worse than the 0.1% decline expected., while producer prices fell by 0.1%, the first decline since August 2013. Meanwhile the Empire manufacturing report for New York fell to 6.17 this month, from 20.5 in September. |
This follows weaker than expected inflation data from China, prompting renewed fears of a slowdown there. | This follows weaker than expected inflation data from China, prompting renewed fears of a slowdown there. |
Fears of a slowdown in the eurozone, in particular Germany, had already put markets under renewed pressure. | Fears of a slowdown in the eurozone, in particular Germany, had already put markets under renewed pressure. |
There were also concerns about the European banking stress tests, the results of which of due to be published at the end of the month. | There were also concerns about the European banking stress tests, the results of which of due to be published at the end of the month. |
On top of that, there are geopolitical concerns, including protests in Hong Kong, the turmoil in the Middle East and the spread of Ebola. | On top of that, there are geopolitical concerns, including protests in Hong Kong, the turmoil in the Middle East and the spread of Ebola. |
Greece has also come under pressure, with the Athens market down nearly 7% on fears of new political turmoil. | Greece has also come under pressure, with the Athens market down nearly 7% on fears of new political turmoil. |
Meanwhile the flood of cheap money supplied by central banks, notably the US Federal Reserve, which has been propping up the market for a number of years is beginning to be turned off. | |
Oil has hit a new four year low, down 0.34% at $84.75 a barrel, with an excess of supplies even as demand falters. | |
But as investors sought havens gold rose $8 to $1242 an ounce, while UK bonds were also in demand. Ten year gilt yields fell to 2.055%, the lowest since June 2013. | But as investors sought havens gold rose $8 to $1242 an ounce, while UK bonds were also in demand. Ten year gilt yields fell to 2.055%, the lowest since June 2013. |