European shares tumble, FTSE hits five-year low
Following the sharp falls in Asian stock markets today, Europe has followed suit as the global financial turmoil continues.
Tokyo’s Nikkei-225 index shed 9.6% and saw its biggest fall in a single session since Black Monday in October 1987. At the end of trading on Friday, Tokyo shares had plummeted 24% during the week.
Meanwhile, the financial crisis has claimed its first Japanese victim after insurance company Yamato Life has collapsed with $2.7 billion in debt.
In early trading, the FTSE 100 share index crashed below the 4,000 mark for the first time in five years. Banks and miners, as well as British Airways and BT led the fall.
Meanwhile, France’s Cac 40 was down 6.2% while Germany’s Dax lost 8.2%.
Iceland has suspended trading on the OMX Nordic Exchange in a bid to prevent further crises. The stock exchange has been closed for trading for two days and is to reopen on Monday.
The co-ordinated rate cuts and cash injections earlier this week failed to boost the markets. Investors are fearing the worst after the International Monetary Fund warned that the world economy is teetering on the brink of recession.
In the meantime, the G7 meeting takes place this weekend which will see finance ministers and economic experts come together from around the globe.
In addition to the G7 meeting, talks will be held at the International Monetary Fund (IMF) in Washington.
Speaking ahead of meetings of the IMF and World Bank, IMF’s chief, Mr Dominique Strauss-Khan, is calling on countries to act ‘quickly, forcefully, and co-operatively‘ to solve the global economic problems.