Recession Fears Hit Stock Markets
BBC: European and Asian markets have fallen sharply on fears that the world economy will enter a protracted downturn.

London's FTSE 100 index was down 1.7% around midday, with mining shares hardest hit. French and German markets also lost ground.

In Asia, Japan's Nikkei index ended 6.8% lower and Hong Kong's main index fell more than 4%.

The slide comes after the Dow Jones share index in New York fell to its lowest level in five years. >>> | November 20, 2008

TIMESONLINE:
Shares Dive as US Jobless Adds Another 542,000 >>> Suzy Jagger, New York | November 20, 2008

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World Markets on Edge as Recession Fears Grow
THE GUARDIAN: In Japan, the Nikkei was driven down by 7% to its lowest level for 5 years / Gloomy US company news add to London nerves

Stockmarkets across Asia have suffered fresh falls following yesterday's steep losses in the US and Europe, as the FTSE 100 fell through the 4000-point mark again and Sony issued a shock profit warning.

Investors have been spooked by the prospect of a deep, prolonged global recession, with a string of large companies warning that their sales and profits will suffer as the downturn bites.

In Japan, the Nikkei was driven down by 7% at one stage in a burst of selling, hitting its lowest point since May 2003. It struggled back in late trading, closing 213 points or 2.5% lower at 8460.98.

After the Japanese market closed, Sony admitted that annual profits will be less than half its previous forecast, at ¥210bn (£1.3bn) down from ¥460bn. It said the strengthening yen has damaged exports, particularly of electronic devices and its PlayStation3 console and games, and also predicted lower sales of televisions, digital cameras and video cameras as the world economy slows.

The picture was also gloomy in South Korea, where the $130bn (£79.8bn) banking bail-out announced last week does not appear to have restored confidence. The composite index of South Korea's biggest companies plunged by 7.5%, with electronic trading having to be halted at one stage.

In London, trading was nervous and volatile following FTSE 100's 188-point drop yesterday. After climbing 37 points at one stage, the index lurched down by over 1% to 3991.29, down almost 50 points.

City confidence had also been undermined by a glut of negative news from America yesterday, which sent the Dow Jones index tumbling by 514.45 points to 8519.21, having been down nearly 700 points at one point in the trading session. >>> Graeme Wearden | October 23, 2008

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Financial Crisis: FTSE 100 Falls Sharply on Recession Fears
THE TELEGRAPH: Shares prices in FTSE 100 in London opened down sharply as fears of recession gripped markets worldwide.

With Japanese shares suffering their biggest loss in two decades, investors were in no mood to hold stocks and within minutes of the start the FTSE 100 index of leading shares fell 236 points - or 5.8pc - to 3840.

Miners, travel companies and retailers were among the biggest fallers as markets focussed on an economic slowdown. TUI Travel slid 18.8pc, platinum miner Lonmin 17pc and plumbing group Wolseley 13pc.

Markets have been spooked the effect of a slowdown on trade as America reported worse-than-expected US retail sales, unemployment rocketed in Britain and increasing evidence of falling demand from China's once booming economy.

Tokyo's Nikkei 225 index plunged 11.41pc to close at 8458, as growing fears of a global recession hammered world markets.

South Korea, whose export-driven economy is in crisis, with the won in freefall and Standard & Poor's saying it might cut credit ratings for the country's leading banks, saw the Kospi index fall 9.4pc in the afternoon, heading for its worst day ever.

Hong Kong's Hang Seng index was down 7.6pc, with mainland Chinese firms exposed to falling commodity prices worst hit. Australia's benchmark S&P/ASX 200 fell 6.7pc and New Zealand's NZX-50 4.8pc to 2,765, its lowest level since September 2004.

Sentiment is grim. "Don't stand in front of the freight train," said Sonray Capital Markets chief economist Clifford Bennett in Tokyo. "This is clearly a panic with further to go. The equity market game has fundamentally changed."

The market has "picked up on the fear factor", said ABN Amro Morgans private client adviser Bill Bishop. "There is nowhere to hide."

The Dow Jones Industrial Average tumbled almost 8pc to close at 8,577.91 - its second steepest points fall in history. The broader Standard & Poor 500 Index plunged 9pc to 907.84.

In the UK, just two days after Gordon Brown's £500bn bail-out of the UK banking system, the FTSE-100 dived 7.16pc, closing down 314.62 at 4079.59 – a trend mirrored across European bourses. Financial Crisis: FTSE 100 Falls Sharply on Recession Fears >>> By Alistair Osborne and Edmund Conway | October 16, 2008

TIMESONLINE:
Markets Slump as World Prepares for Long Recession: Bailout bounce erased by global market plunge >>> Suzy Jagger in New York, Carl Mortished and Gráinne Gilmore | October 16, 2008

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London Shares Fall as Bail-out Euphoria Gives Way to Slowdown Fears
THE TELEGRAPH: Shares in London fell as a two-day global rally faltered as the euphoria surrounding a £2 trillion worldwide effort to bail out banks and reinvigorate lending was replaced by growing fears over corporate profits and the possibility of a recession.

The FTSE 100 index of leading shares opened down 35 points - or around 1 per cent - at 4352 as grim reality hit stock markets following a week of rollercoaster boom and bust culminating in huge rises on Monday and Tuesday.

"After a bumper start to the week, the inevitable reversal for equity markets does seem to be underway but there's certainly no real belief so far that this will mark the end of the rally at least in the short term," said Matt Buckland, trader at CMC Markets.

Financial stock were the main risers with Lloyds TSB up 7.5pc, HBOS 3.9pc and Royal Bank of Scotland 1.1pc. Concerns of a global slowdown saw miners fall further.

Asia followed Wall Street down. Tokyo's Nikkei index, which was down 1.4 per cent before lunch follwing its record 14 per cent rise on Tuesday, perked up in the afternoon to trade up 1pc.

But Hong Kong's Hang Seng Index was down 2 per cent, while Australia's S&P/ASX 200 index was down 0.8 per cent, New Zealand's benchmark NZX-50 index 3.9pc, and South Korea's Kospi index 2 percent.

Overnight, the Dow Jones index in New York had fallen 76.6, or 0.8 percent, to 9,311, after a record gain on Monday in advance of President George W. Bush's announcement of a $250 billion bank bail-out package. London Shares Fall as Bail-out Euphoria Gives Way to Slowdown Fears >>> By Richard Spencer in Beijing and Danielle Demetriou in Tokyo | October 15, 2008

THE TELEGRAPH:
Era of Self-regulation Is Over, European Commission Warns: The European Commission has warned the business community that the "ideology" of self-regulation is dead and that more rules are required at both the European and global level. >>> By Richard Tyler in Brussels | October 14, 2008

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Recession Danger Is Real, Warns Mervyn King

THE TELEGRAPH: The British economy faces the real risk of falling into recession, the Governor of the Bank of England has admitted.

Mervyn King warned families to brace themselves for a further "squeeze" on household finances as rising energy bills and food prices continue to rise.

Mr King said that inflation was set to increase sharply to about 3.7 per cent - almost double the official target. As a result most British people will feel poorer this year as pay rises fail to keep pace with rising costs.

The Governor - who said that "the nice decade is behind us" - also warned homeowners that property prices would fall further and that it was impossible to predict the scale of the decline.

He became the first senior public figure to openly discuss the possibility that the British economy may now be heading for recession. The economy was "travelling along a bumpy road" and that a sharp downturn could not be ruled out, he said. Recession Danger Is Real, Warns Mervyn King >>> By Robert Winnett | May 15, 2008

THE TELEGRAPH:
Financial Crisis: Labour's History Is Repeating >>> By Edmund Conway | May 15, 2008

The Dawning of a New Dark Age (Paperback - UK)
The Dawning of a New Dark Age (Hardback - UK)

The Fed Cuts Interest Rates Again
FINANCIAL TIMES: The Federal Reserve on Wednesday cut interest rates by a further 50 basis points to 3 per cent, in an aggressive move to try to keep the US out of recession.

The 50 point reduction, hot on the heels of the unscheduled 75 basis point cut last week, takes the total reduction over the past eight days to 125 basis points.

This is the most radical adjustment of Fed rate policy in a short period of time since 1982.

It reflects concern that a negative feedback loop between the financial system and the economy could be spreading from housing to other sectors. Fed cuts rates by 50 basis points >>> By Krishna Guha in Washington

FT:
Full text of Fed statement

FT:
Bernanke’s reflation gamble may work too well By Martin Wolf

FT:
Back to ‘the economy, stupid’: How a slowdown will influence America’s presidential contest By Edward Luce

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Dow Plunges More than 300 Points on Grim Outlook
NEW YORK TIMES: Stock markets plunged on Thursday as investors confronted a troubling manufacturing report and new indications of the depth of subprime losses and housing woes. The Dow Jones industrial average lost more than 300 points.

The Standard and Poor’s 500-stock index, a broad measure of the financial markets, tumbled below its low for last year, set in March. At the close, it was down 2.9 percent after giving up early morning gains, bringing its decline since Jan. 1 to 9.2 percent.

The Dow Jones industrial average ended down 306.95 points, or 2.5 percent, at 12,159.21, and the technology-heavy Nasdaq composite index was off 2 percent.

A dismal report on manufacturing activity caught investors by surprise on Thursday morning, sending the main indexes into the red after an early stint in positive territory.

The Federal Reserve reported that a survey of Philadelphia-area manufacturers contracted much more than expected. A similar drop in the index occurred in early 2001, just before the onset of the last recession.

“Basically every day now, you have more and more investors leaning toward the camp that yes, this is going to be a recession, and it could be a severe one,” said David Kovacs, a quantitative investment strategist at Turner Investment Partners in Berwyn, Pa.

Recession fears have been roiling the market of late, sending the S.& P. down 8 percent since the beginning of the year. Dow Plunges More Than 300 Points on Grim Outlook >>> By Michael M. Grynbaum

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Shares Slump on Recession Fears
BBC: European and US shares have fallen sharply as poor US retail sales figures and Citigroup's first quarterly loss added to fears of a US recession.

In London the FTSE 100 index of leading shares slumped by more than 3% - its biggest one-day fall since the height of the credit crunch in August.

Meanwhile France's Cac 40 index lost 2.8% while Germany's Dax slid 2.1%.

Sales in US shops fell by 0.4% in December from a year earlier, as consumers tightened their belts.

And Citigroup, the giant US banking firm, reported a $9.83bn (£5bn) net loss for the last three months of 2007, taking its total writedowns as a result of exposure to sub-prime loans to $18bn.

"The losses at Citigroup - whilst fully expected - still seem to be unsettling traders across the Atlantic, whilst at the same time the lacklustre US retail sales figures are confirming that the economy is slowing," said CMC Markets trader Jimmy Yates. Shares slump on recession fears >>>

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