World stock exchanges came under pronounced selling pressure Monday on lingering fears that banks remained vulnerable to further fallout from the collapse of the US high-risk mortgage market.
In London the FTSE 100 index lost 2.71 percent to close at 6,120.80 points while in Paris the CAC 40 shed 1.65 percent to end the day at 5,432.57. The Frankfurt Dax fell 1.32 percent to finish at 7,511.97. The Euro Stoxx 50 index of leading eurozone issues gave up 1.30 percent to close at 4,226.70.
Asian stocks closed mostly lower Monday as worries about a US economic slowdown sent Japan''s stock market to its lowest level this year. Tokyo''s Nikkei-225 index fell 0.74 percent, Seoul was down 1.7 percent, Taiwan fell 0.96 percent, Singapore shed 0.85 percent and shares in Mumbai retreated 0.33 percent.
On the London currency market the dollar was stable against the euro but was under strain from disappointing US economic data released last week and an agreement by Opec to consider pricing oil in currencies other than the greenback.
The single European currency in late-day trade was at 1.4661 dollars against 1.4659 late Friday in new York. On Wall Street, shares fell sharply in midday deals Monday. The Dow Jones Industrial Average lost 1.02 percent and was trading at 13,042.01 while the tech-dominated Nasdaq shed 1.28 percent to reach 2,603.46.
With no economic news on tap, investors focused on the latest analyst report on Citigroup. Goldman Sachs said in a note that Citi may have to write off an additional 15 billion dollars in soured mortgage investments, adding to the gloom in the finance sector.
Financial markets are nervous that more banks will report losses stemming from the subprime or high-risk loan crisis in the United States, where a wave of foreclosures has undermined mortgage-backed securities held by banking and finance institutions around the world.
In London shares in troubled British lender Northern Rock plunged 21.42 percent to close at 104.20 pence after the bank disclosed that take-over proposals received so far had significantly undervalued the company. Northern Rock had to be bailed out by the Bank of England in September.
Elsewhere in the banking sector, RBS fell 5.28 percent to 404 pence, Barclays gave up 3.49 percent to close at 491.25 and HSBC fell 2.13 percent to reach 826 pence.
Brewer SABMiller shed 2.83 percent to finish at 1,306 pence after acquiring Dutch rival Grolsch for 816 million euros. In Paris cosmetics group Clarins shot up 7.70 percent to 64.51 euros on speculation it was to be taken over by a major luxury group. L''Oreal and PPR have been cited as possible suitors.
In Frankfurt chipmaker Infineon fell 1.23 percent to reach 8.05 euros after voicing concern in the German press about the effect of the weak dollar on its 2007-2008 fiscal year, which began in October.
Elsewhere there were declines of 2.40 percent to 37,612 in Milan, 1.46 percent to 15,539.3 in Madrid, 1.80 percent to 491.09 in Amsterdam, 2.45 percent to 8,270.88 on the Swiss Market Index and 1.70 percent to 3,991.74 in Brussels.
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