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Black Thursday: stock markets plummet
23.09.2011 08:19 "Agro Perspectiva" (Kyiv) —
Thursday, Sept. 22, saw the most serious stock market plunge since early Fall. Asian markets fell first and others followed in the domino effect over concerns with negative Federal Reserve forecasts, bad news from Europe and Italy’s trouble.
Asia saw a large-scale sell-off with indexes tumbling by 9%. Indonesia’s market had the worst of it with Hong Kong’s Hang Seng Index losing 5 % while other stocks shrank 23%.
Analysts are looking for the causes. First, Europe had presented poor statistics showing that ISM Manufacturing Index and Industrial New Orders appeared to be lower than forecasted. Then Standard & Poor’s agency downgraded the rating of seven Italian banks and the country itself.
The worst news came from the US where Moody’s downgraded the ratings of America’s biggest banks Wells Fargo, Citigroup and the Bank of America. Moreover, the Federal Reserve stated that there are «significant downside risks to the economic outlook» says the CEO of the Nord-West Capital Andrey Kabanov.
Asian panic spread to Russia. MICEX index lost 7,5% and RTSI -more than 8 exceeding the psychological barrier of 1,400 points. Sessions were even suspended several times due to too sharp falls of some securities. European indexes also lost 35 percent and then came the US with more than a 3-percent drop.
Russia’s exchange markets also experienced dramatic falls. One US dollar was traded for 32 rubles for the first time since September 2009. This was affected by external negative factors says financial analyst Alexander Laputin
On Forex exchange market euro to dollar rate dropped lower than 1,3400 for the first time since February over concerns with the Greek debt crisis and European banks asking for short-term loans.
All experts agree that the current recession will last long. Markets need good news but there’s not any.
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