Around the World's Markets
Saturday 22 August 1998
EQUITIES CRASHED with Footsie losing 190.4 points to 5,477, the biggest one-day points fall since the 1987 crash, with nearly pounds 34bn wiped off share values. Sliding global markets - fearful the Asian crisis is spreading to South America, and Russian problems deepening - devastated London shares. The mid cap index also crashed and the small cap index plunged to its lowest this year. Earlier this week Footsie scored its best ever one-day points gain.
Derek Pain, page 19
FEAR OF a snowballing global economic crisis and the fallout from US strikes on Afghanistan and Sudan ravaged Wall Street stocks. At midday the Dow was down 243 points, or 2.8 per cent, to 8,369. The Nasdaq composite fared worse, down 63 points, or 3.34 per cent, to 1,771.
"Attention is fixed on the political arena, especially the anti-terrorist campaign and emerging nations," said Michael Metz, a managing director at CIBC Oppenheimer.
STOCKS FELL moderately on Friday as Japan's third-largest 1998 corporate failure raised fears about the economy. The Nikkei 225 shed 93.21 points, 0.61 per cent, to close at 15,298.20. Stocks started lower after a drop on Wall Street overnight and news that Japanese trading firm Okura would file for bankruptcy with debts of 257.7bn. The slide was stemmed by reports the government is preparing to financially support a merger of Long-Term Credit Bank of Japan and Sumitomo Trust and Banking.
STOCKS LOST STEAM, closing lower in tandem with weaker overseas markets and lacking support from government buying, brokers said. The Hang Seng lost 214.9 points, or 2.8 per cent, to end at 7,527.6. Frederick Tsang at DBS Securities said. "To make intervention effective [the government] can't let the speculators know ... their next move." Brokers said the hedge funds battle with government was likely to go on before contracts expired next week.
INDONESIAN STOCKS fell after the government said it would not sell a majority stake in state cement company PT Semen Gresik to foreigners, casting doubt on the state's asset sale drive. The Stock Exchange Composite Index fell 11 points, or 2.75 per cent, to 388.3. Over the week, it has shed 3.6 per cent. Gresik plunged 23 per cent, accounting for almost a third of yesterday's decline alone. The stock rose as high as 14,125 last month on optimism about its possible sale to Semex of Mexico.
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