Business | Markets
Stocks in Asia and Europe fall over fears of global recession
Stocks declined in Asia and Europe, with benchmark indexes from Tokyo to Budapest falling more than 6 per cent, on growing concern bailout plans in the US and Europe will fail to avert a global recession. US index futures advanced.
- Bloomberg
- Published: 13:18 October 16, 2008
Dubai: Stocks declined in Asia and Europe, with benchmark indexes from Tokyo to Budapest falling more than 6 per cent, on growing concern bailout plans in the US and Europe will fail to avert a global recession. US index futures advanced.
Japan's Nikkei 225 Stock Average sank 11 per cent, and South Korea's Kospi Index slumped 9.4 per cent. Oil dropped to a 13-month low, extending its decline from a July record to more than 50 per cent. BHP Billiton Ltd. lost 5 per cent and Rio Tinto Group slipped 7.5 per cent on speculation the slowdown will slash demand for metals.
“Investor confidence has been hammered,'' said Henk Potts, a London-based fund manager at Barclays Stockbrokers, which has about $45 billion in assets under management. “There is a considerable amount of unease about how deep the recession could be. There simply aren't any buyers around.''
The MSCI World Index lost 2.7 per cent to 924.9 at 9:23 am in London, declining for the second day and trimming this week's gain to 1.6 per cent. Europe's Dow Jones Stoxx 600 Index fell 3.3 per cent, while the MSCI Asia Pacific Index lost 9 per cent. Futures on the Standard & Poor's 500 Index added 0.7 per cent.
Royal Dutch Shell Plc, Europe's biggest oil company, sank 5 percent. TNT NV, Europe's second-biggest express-delivery company, lost 10 per cent after lowering its profit forecast for parcel-delivery operations.
“There has been a realization recession has arrived and it's going to be deep-seated,'' David Buik, a market analyst at BGC Partners in London, said in a Bloomberg Television interview. “The banking-rescue act seems to have gone on the back burner.''
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