WORRIES ABOUT EUROPE’S economic and debt problems sent stock markets falling today, ending their three-day rebound after last week’s slump.
The major indexes bounced up and down in another volatile day: the Dow Jones fell more than 120 points in the first half-hour of trading, after a report showed that Germany’s economy had stalled and dragged down growth for Europe.
The Dow pared most of its losses by noon, but resumed its drop after Angela Merkel and Nicolas Sarkozy had tried to calm worries about Europe’s debt problems by pushing for long-term political solutions.
Markets were hoping for immediate financial measures like the introduction of a Eurobond, and its absence showed: the Dow fell as many as 190 points shortly after 1pm in New York before again paring its losses.
At the close of trading, the Dow was down 65 points, or 0.6 per cent. The S&P 500 index was down 9 points, or 0.8 per cent, while the NASDAQ was down by 25 points, or around 1 per cent.
In Europe, the FTSE 100 ended with a 0.13 per cent gain, but markets in Paris and Frankfurt closed in the red. The ISEQ index in Dublin fell by around 0.45 per cent.
“The real question the market is trying to answer is: Are we going to have another recession or not?” said John Burke, head of Burke Financial Strategies with $200 million in assets under management.
“Today, the answer is maybe yes because it doesn’t look like Europe has figured out a solution to its debt.”
Prices for gold and Treasury bonds rose as money moved into investments considered safer. Oil fell on worries that a weaker economy will mean less demand for energy.
Additional reporting by AP
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