Stocks plummet as global turmoil continues
There was further turmoil in the global stock markets yesterday, as stocks plummeted to their lowest levels as the credit crisis deepens in Europe.
UK stocks suffered their worst falls since Black Monday in 1987 with the FTSE 100 falling by 7.8%, In the US the Dow Jones fell below 10,000 for the first time since Oct 2004 and the S&P 500 fell by 2.3% to 1,073.81, its lowest level since Aug 2004.
There is now increased speculation that Central Banks around the world will reduce interest rates in order to cushion their economies from the credit freeze. The market now deems there to be a greater probability that the BoE will cut rates this Thursday by up to 50bps.
Overnight Australia's Central Bank cut its benchmark rate by 1%, twice the amount that was predicted, to 6%.
The unwinding of carry trades saw the yen strengthen against a range of higher yielding currencies. As volatility increased yesterday funds were converted into yen, the currency in which funds are initially borrowed to transact the trade.
The contents of this blog are for information purposes only. It is not intended as a recommendation to trade or a solicitation for funds. The Wise Money Blog cannot be held responsible for any loss or damages arising from any action taken following consideration of this information.
UK stocks suffered their worst falls since Black Monday in 1987 with the FTSE 100 falling by 7.8%, In the US the Dow Jones fell below 10,000 for the first time since Oct 2004 and the S&P 500 fell by 2.3% to 1,073.81, its lowest level since Aug 2004.
There is now increased speculation that Central Banks around the world will reduce interest rates in order to cushion their economies from the credit freeze. The market now deems there to be a greater probability that the BoE will cut rates this Thursday by up to 50bps.
Overnight Australia's Central Bank cut its benchmark rate by 1%, twice the amount that was predicted, to 6%.
The unwinding of carry trades saw the yen strengthen against a range of higher yielding currencies. As volatility increased yesterday funds were converted into yen, the currency in which funds are initially borrowed to transact the trade.
The contents of this blog are for information purposes only. It is not intended as a recommendation to trade or a solicitation for funds. The Wise Money Blog cannot be held responsible for any loss or damages arising from any action taken following consideration of this information.
Labels: banks nationalisation, credit crunch, interest rates, stock market falls
posted by Dr Search- Principal Consultant at the Search Clinic @ 9:20 AM
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