European markets fall on opening

10:20, 22 October 2008
World
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European stock markets fell...

European stock markets fell on opening, following heavy losses on Asia markets, as fears of a global recession returned to haunt investors, according to BBC.

In London the benchmark FTSE index was down 2% not long after opening, and in France and Germany the Cac and Dax indexes were both down 2.8%.

The falls came after Japan`s Nikkei closed down 6.8%, and Korea`s index fell 5.1% to close at a three-year low.

Other Asian shares fell on fears a US recession would hit the global economy.

Commodity falls

"The old `story` that has been put aside in the recent period of financial market crisis now comes back to the market`s mind: recession fears," Commerzbank said in a note.

On Tuesday evening, the governor of the Bank of England, Mervyn King, warned that Britain was probably entering its first recession in 16 years.

Stocks were also dragged down by commodity stocks tracking weaker oil and copper prices

On Tuesday, Wall Street`s Dow Jones index sank 2.5% after several US firms reported weak earnings figures.

The firms, such as Caterpillar and DuPont, were also all cautious about their prospects.

Widespread sell-off

In early trade on Wednesday, the FTSE 100 was down 96 points, or 2.28%, at 4133.28 points. The Dax in Frankfurt was down 124 points, or 2.81% at 4649 points, and the Cac 40 in Paris was down 99 points, or 2.84%, at 3376 points.

Earlier, Japan`s benchmark Nikkei had fallen 631.56 points, or 6.8%, to 8,674.69 - its biggest one-day loss in percentage terms since last Thursday, when it fell 11%. The broader Topix index fell 7.1% to close at 889.23.

The Korea Composite Stock Price Index closed at 1,134.59 points, the lowest close since early autumn 2005, and had touched a low of 1,095.56 earlier in the day.

In other Asian markets, Singapore`s benchmark index fell 5% to a four-year low, as banking and property shares slid on worries the global economy is heading for a recession.

Similar concerns pushed the share index in Australia down 3.4%.

 

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