Hong Kong fall sets scene for turmoil in markets
Tuesday 01 September 1998
The Duma's decision to reject Vicktor Chernomyrdin as prime minister came after the close of European markets, but analysts said the move would increase fears of a worsening situation in Russia.
As London traders return to their desks today after the August bank holiday, they will face markets still jittery after further volatile sessions yesterday.
Hong Kong stocks were the hardest hit with the Hang Seng losing almost 6 per cent of its value in the first seven minutes of trading yesterday following a government retreat from its massive buying campaign last Friday.
The Hang Seng eventually closed 7 per cent lower, or 544 points down, at 7,275.04. In Frankfurt, the Xetra DAX fell 114.52 points, or 2.32 per cent to close at 4,811.28. Some dealers are forecasting a further 300 point fall.
In France the CAC-40 fell 57.12 points, or 1.54 per cent to 3,651.85 on thin volume.
In Russia, where the rouble crisis sparked the global downturn, the RTS1- Interfax index dipped 1.74 per cent on minimal volume.
In Brazil, where share prices fell by 40 per cent in August, a further two per cent fall was registered when European markets closed.
Markets had drawn comfort early on from a 1.38 per cent rally in Tokyo stocks. The Nikkei closed 192.6 points higher at 14,107 though elsewhere in Asia most share markets took a tumble.
Wall Street opened strongly and was up 43 points at one stage, but that confidence soon disappeared and the early gains turned into a 135 point fall (by 4.40pm), the first time the market had slipped below the 8,000 mark since 2 February.
The Nasdaq Composite was also hammered, shedding 4.5 per cent at one stage.
On Wall Street dealers were pessimistic yesterday : "People are piling out of technology stocks," one senior trader said. "There is no news behind the plunge, just all round liquidation."
However, in London, some leading economists were more sanguine. Michael Hughes, a director of Barings Asset Management, said: "Until you can pinpoint some new news, this market will be directionless.
"The really good news would be US or UK interest rates starting to fall, but that might not happen until October or November," he said. "Until then the focus will be on the bad news, particularly the Russian situation. Uncertainty there will cap the market for a while.
"But there is no doubt that we are starting to see some semblance of value in the UK and, to some extent, in Asia."
Attention this week will shift to a meeting between American President Clinton and Boris Yeltsin.
The pair meet tomorrow while Mr Yeltsin is still grappling with the financial crisis and a political vacuum following his decision a week ago to dismiss the government led by former Prime Minister Sergei Kiriyenko.
Missing Malaysia Airlines Flight MH370: Wreckage could be found within a week as search reaches 'very critical juncture', says minister
South Korea ferry disaster: Released transcripts show chaos and confusion in the moments before ferry sinks
Unbeliebable: The White House offer 'no comment' to anti-Justin Bieber petition
Loch Ness Monster found on Apple Maps?
Shropshire criminals ‘using unmanned drones and infrared cameras to find illegal cannabis farms’ – and then steal from the growers
The food poverty scandal that shames Britain: Nearly 1m people rely on handouts to eat – and benefit reforms may be to blame
Scottish independence: It is the English who should be on their knees, begging the Scots to vote ‘No’
'Sinful': Video of British Muslims dancing to Pharrell Williams's hit Happy comes under attack
Nigel Farage: I’m taking on the status quo, and the Establishment’s fighting back
Abdullah Deghayes: My son was the martyr of a just cause, says father of British teenager killed in Syria conflict
Ukraine crisis: Helicopter gunships take country closer to all-out war
- 1 Chelsea 1 Sunderland 2: Graceless reaction of Jose Mourinho a sad effort to hide his own flaws
- 2 A bottle of wine a day is not bad for you and abstaining is worse than drinking, scientist claims
- 3 Unbeliebable: The White House offer 'no comment' to anti-Justin Bieber petition
- 4 Loch Ness Monster found on Apple Maps?
- 5 Shropshire criminals ‘using unmanned drones and infrared cameras to find illegal cannabis farms’ – and then steal from the growers
iJobs Money & Business
Negotiable: Harrington Starr: Database Team Lead ( Leadership, Sybase, Compute...
£40000 - £50000 per annum + Bonus+Benefits+Package: Harrington Starr: C#.NET D...
£25000 - £35000 per annum + Bonus+Benefits+Package: Harrington Starr: VB.NET S...
£45000 - £55000 per annum + Bonus and Benefits: Harrington Starr: Trade Suppor...