World stocks mostly drop
Tuesday, 23 December 2008
LONDON, Dec 22 (AFP): Global stocks mainly fell today, despite a multi-billion-dollar US government lifeline for the American auto industry, as analysts warned of volatile trading in the run-up to Christmas.
Investors also pondered whether markets would enjoy a so- called Santa rally at the end of a year which saw the global financial crisis help spark a recession in the eurozone, Japan and the United States.
Traders had been lifted by the announcement of a 13.4- billion-dollar (9.5- billion-euro) government bailout for two of the Big Three US automakers but soon fell away as concerns for the global economy returned.
"Equity markets start the week slightly lower although with the Christmas break nearing, the coming days' trade will be characterised by lower volumes and increased volatility as a result," said CMC Markets dealer Jimmy Yates.
"There's also the question as to whether we'll see the famed Santa rally as 2008 draws to a close, but with a year that has been defined by high levels of volatility, such patterns may yet prove somewhat elusive."
European stocks slid in morning deals, with Frankfurt down 1.86 per cent, London losing 0.91 per cent and Paris dropping 1.63 per cent.
In recession-hit Germany, the market sank after a new poll showed that consumer confidence stagnated after three straight months of gradually growing optimism.
The outlook index from the GfK institute for Europe's biggest economy remained at 2.1 points for January, after an initial value of 2.2 points for December was revised lower by 0.1 points.
In Asia Monday, Hong Kong shares dived 3.30 per cent, as heavyweight China Mobile pulled down the main index and investors took profit after a two-week surge.
Shanghai lost 1.52 per cent, Sydney closed 1.60 per cent down and Seoul finished 1.36 per cent lower. Singapore shed 2.78 per cent and Kuala Lumpur declined by 0.30 per cent.
However, Tokyo won 1.57 per cent despite the government saying for the first time in almost seven years that the outlook for the world's second biggest economy was getting worse. The last time it used such negative language was in February 2002.
Investors also pondered whether markets would enjoy a so- called Santa rally at the end of a year which saw the global financial crisis help spark a recession in the eurozone, Japan and the United States.
Traders had been lifted by the announcement of a 13.4- billion-dollar (9.5- billion-euro) government bailout for two of the Big Three US automakers but soon fell away as concerns for the global economy returned.
"Equity markets start the week slightly lower although with the Christmas break nearing, the coming days' trade will be characterised by lower volumes and increased volatility as a result," said CMC Markets dealer Jimmy Yates.
"There's also the question as to whether we'll see the famed Santa rally as 2008 draws to a close, but with a year that has been defined by high levels of volatility, such patterns may yet prove somewhat elusive."
European stocks slid in morning deals, with Frankfurt down 1.86 per cent, London losing 0.91 per cent and Paris dropping 1.63 per cent.
In recession-hit Germany, the market sank after a new poll showed that consumer confidence stagnated after three straight months of gradually growing optimism.
The outlook index from the GfK institute for Europe's biggest economy remained at 2.1 points for January, after an initial value of 2.2 points for December was revised lower by 0.1 points.
In Asia Monday, Hong Kong shares dived 3.30 per cent, as heavyweight China Mobile pulled down the main index and investors took profit after a two-week surge.
Shanghai lost 1.52 per cent, Sydney closed 1.60 per cent down and Seoul finished 1.36 per cent lower. Singapore shed 2.78 per cent and Kuala Lumpur declined by 0.30 per cent.
However, Tokyo won 1.57 per cent despite the government saying for the first time in almost seven years that the outlook for the world's second biggest economy was getting worse. The last time it used such negative language was in February 2002.