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Shares fall on more economy fears | Shares fall on more economy fears |
(about 3 hours later) | |
US shares fell in early trading on Wall Street, following declines in Europe and Asia as concerns remain about the threat of a recession in the US. | |
In opening exchanges, the Dow Jones index was down 0.5% or 64 points to 12,143, while the Nasdaq had lost 0.7%. | |
Meanwhile, the UK's FTSE 100 was 2% lower, Germany's Dax had lost 0.7%, and France's Cac was down 1.6%. | |
Analysts said investors were cautious ahead of an expected interest rate cut from the Federal Reserve on Wednesday. | Analysts said investors were cautious ahead of an expected interest rate cut from the Federal Reserve on Wednesday. |
In Japan, the Nikkei 225 had earlier finished the day's trading down 4%. | |
Hong Kong's Hang Seng index closed down 4.3%, while Mumbai's Sensex finished 1.1% lower. | Hong Kong's Hang Seng index closed down 4.3%, while Mumbai's Sensex finished 1.1% lower. |
'No appetite' | 'No appetite' |
Despite the falls, the market mood seemed calmer after last week's sharp ups and downs. | |
The market appears to have hit bottom last week but it's still not in a position to keep rising, considering various events pending such as the Fed rate decision Koichi Ogawa, Daiwa SB Investments | The market appears to have hit bottom last week but it's still not in a position to keep rising, considering various events pending such as the Fed rate decision Koichi Ogawa, Daiwa SB Investments |
The week had begun with sharp stock market falls on growing worries over the US economy, only for them to recover later in the week by a $150bn (£76bn) stimulus plan agreed between the US Congress and the Bush administration. | The week had begun with sharp stock market falls on growing worries over the US economy, only for them to recover later in the week by a $150bn (£76bn) stimulus plan agreed between the US Congress and the Bush administration. |
"Investors don't have the appetite to buy stocks now," said Francis Lun, general manager at Fulbright Securities in Hong Kong. | |
"The market appears to have hit bottom last week but it's still not in a position to keep rising, considering various events pending such as the Fed rate decision," said Koichi Ogawa, chief portfolio manager at Daiwa SB Investments in Tokyo. | "The market appears to have hit bottom last week but it's still not in a position to keep rising, considering various events pending such as the Fed rate decision," said Koichi Ogawa, chief portfolio manager at Daiwa SB Investments in Tokyo. |
Uncertainty | Uncertainty |
Many analysts are expecting the Federal Reserve, the US's central bank, to cut interest rates again when it makes its next scheduled decision on Wednesday. | Many analysts are expecting the Federal Reserve, the US's central bank, to cut interest rates again when it makes its next scheduled decision on Wednesday. |
Last week it reduced rates to 3.5% from 4.25% in an emergency move. | Last week it reduced rates to 3.5% from 4.25% in an emergency move. |
Analysts are also waiting for any further economic details in President Bush's State of the Union address late on Monday. | Analysts are also waiting for any further economic details in President Bush's State of the Union address late on Monday. |
"There's a lot of uncertainty out there: uncertainty over the US economy, uncertainty over China's economy," said Rob Hart, an analyst with Morgan Stanley in Hong Kong. | "There's a lot of uncertainty out there: uncertainty over the US economy, uncertainty over China's economy," said Rob Hart, an analyst with Morgan Stanley in Hong Kong. |
"People are also worried about contagion in Europe," he added. | "People are also worried about contagion in Europe," he added. |
"If the US slows down, will it trigger a slowdown in Europe?" | "If the US slows down, will it trigger a slowdown in Europe?" |