Printer Friendly

Russian roulette and Wall Street woes send Euro shares tumbling; mkt reps MARKET REPORTS.

European share prices wilted in volatile trade yesterday. Several attempted rallies came to nothing after further unsettling news from Russia and another slide on Wall Street.

Germany's Xetra DAX index of leading shares ended almost two per cent lower in value after a strong start was reversed, while French shares shed 1.4 per cent having being up around two per cent at one point.

The Dow Jones index was down around one per cent, or 90 points, taking it below the 8,000 level at the end of European trading.

The bank holiday in London also had a dampening influence on European shares.

Markets on the Continent drew early limited comfort from a 1.38 per cent rally in Japanese stocks, though elsewhere in Asia most share markets took a tumble, led by a seven per cent drop in Hong Kong.

In Germany, shares lost ground in line with other European indices, as traders braced for more disturbing news from Russia.

Analysts said further losses this week remained a possibility, although there was still some strength in corporate earnings.

"There is some risk that the DAX will fall back to 4500 points because there are no support levels you can draw on between 5,000 and 4,500," Vereinsbank's Mr Gerhard Schwarz said.

French shares were particularly volatile, falling over two per cent on a choppy futures and options expiry and with Wall Street falling through the 8,000 level, although prices picked up later.

Many investors were sidelined by the Russia crisis. But some regard current prices to be good value with interest rates falling and fundamentals still solid.

The story was similar elsewhere with Spain's IBEX share index down 1.4 per cent, while the Swiss Market index shed 1.6 per cent and Amsterdam's AEX index was down 0.6 per cent.

In currencies, the dollar calmed against the mark and yen. But currency markets are still jittery.

The dollar was shaky due to the impact of the emerging market turmoil on the US economy. The Swiss franc was the gainer in the race into quality assets.

"The currency market is pricing in a contagion effect from the Latin American economies and also the possibility of a US rate cut," said Mr Klaus Kusber, currency analyst at Dresdner Kleinwort Benson in Frankfurt. "But I think the recent drop in the doll ar has been exaggerated."

Yesterday's lows meant the dollar has shed about five per cent of its value against the mark and Swiss franc since late last week.

It kept a weak tone against the yen after reaching a one-month low on Friday despite the fact that Japan suffers from the Asian financial turmoil, an economy in recession and an ailing banking system.

Even though stock prices seemed far more stable in Tokyo, signs of gloom and fear about the world's economic future remain.
COPYRIGHT 1998 Birmingham Post & Mail Ltd
No portion of this article can be reproduced without the express written permission from the copyright holder.
Copyright 1998 Gale, Cengage Learning. All rights reserved.

Article Details
Printer friendly Cite/link Email Feedback
Publication:The Birmingham Post (England)
Date:Sep 1, 1998
Words:479
Previous Article:Boom times at the shops.
Next Article:Investors on brink as Dow Jones plunges.

Terms of use | Privacy policy | Copyright © 2021 Farlex, Inc. | Feedback | For webmasters