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Worldwide share jitters continue | Worldwide share jitters continue |
(about 2 hours later) | |
Global stocks finished down on Friday, as concerns returned about the state of the worldwide financial sector. | |
With analysts saying some investors were also profit taking after two days of solid rises, Wall Street's main Dow Jones index lost 171 points to 12,207. | |
The Nasdaq ended 35 points lower, while London's FSTE fell 6.8 points to 5,869, and Frankfurt's Dax lost 4.3 points. | |
Analysts said sentiment was hit by rumours of more big losses to be reported in the global banking sector. | |
Dutch banks ING and Fortis were mentioned in some reports. Both said they declined to comment on market speculation. | |
There was also rumours that one of the main US hedge funds was in financial difficulty. | |
US economic plan | US economic plan |
Global stocks had risen earlier on Friday as investors welcomed the previous day's announcement of a US government plan to spend $150bn (£76bn) reviving the country's economy. | Global stocks had risen earlier on Friday as investors welcomed the previous day's announcement of a US government plan to spend $150bn (£76bn) reviving the country's economy. |
We expect sharp gains and losses in the next few days and weeks Heinz-Gerd Sonnenschein, a strategist at Postbank | We expect sharp gains and losses in the next few days and weeks Heinz-Gerd Sonnenschein, a strategist at Postbank |
Strong earnings from Microsoft and building equipment firm Caterpillar had also helped to lift the mood, with Japan's main Nikkei index closing up 4%. | Strong earnings from Microsoft and building equipment firm Caterpillar had also helped to lift the mood, with Japan's main Nikkei index closing up 4%. |
On Monday, stock markets from Japan to the UK were heavily sold on growing fears that the US would fall into a recession and drag down other key economies too. | On Monday, stock markets from Japan to the UK were heavily sold on growing fears that the US would fall into a recession and drag down other key economies too. |
In many markets, the falls were the worst since the 11 September 2001 attacks on the US. | In many markets, the falls were the worst since the 11 September 2001 attacks on the US. |
The resulting turmoil prompted the Fed, the US central bank, to cut US rates to 3.5% from 4.25%. | The resulting turmoil prompted the Fed, the US central bank, to cut US rates to 3.5% from 4.25%. |
Analysts now expect more volatility in the short term. | Analysts now expect more volatility in the short term. |
"We expect sharp gains and losses in the next few days and weeks," said Heinz-Gerd Sonnenschein, a strategist at Postbank in Germany. | "We expect sharp gains and losses in the next few days and weeks," said Heinz-Gerd Sonnenschein, a strategist at Postbank in Germany. |
"The US has done many things to stabilise the market, but all the bad news is not yet out there." | "The US has done many things to stabilise the market, but all the bad news is not yet out there." |