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Saturday 14th of February 2009
March 1, 2007

Global equities markets continue to decline

by Elaine Frei

Global equities markets continue to decline

Equities markets continued to decline on Thursday, with even Wall Street having trouble after seeing some gains on Wednesday.

Asian markets were down again. Hong Kong’s Hang Seng Index dropped another 1.55 per cent, losing 304.91 points to close at 19,346.60, while Singapore’s STI fell 0.95 percent to 3,092.58. In Japan, meanwhile, the Nikkei 225 was 0.9 percent lower to 17,453.51, while the Topix index was down 0.7 percent to 1,740.11. Declines were seen in both domestic and export-focused sectors, with advances seen where individuals companies were the focus of good news.

In Europe, the FTSE Eurofirst 300 dropped 0.9 percent to 1,469.02, but was as high as 1,495.16 during the session. The CAC 40 and the Xetra Dax each fell 1.1 percent, to 5,458.40 and 6,640.24 respectively, while in Moscow the RTS fell 5.72 percent, a loss of 108.98 points, to close at 1,797.10. Insurance saw declines, while banks were mixed.

The FTSE 100 dropped 0.9 percent to 6,116 in London as it lost another 55.5 points on the session after early advances. The FTSE 250 fell 0.89 percent to 10,983.90. Gains were seen by banks and tobacco companies, while miners and oil companies saw losses. In the insurance sector, Aviva (LSE: AV) dropped 4.7 percent despite profits that were up by 12 percent in 2006.

At midday in New York, the Dow Jones Industrial Average was 0.19 percent lower to 12,245.48, while the Nasdaq Composite had fallen 0.38 percent to 2,407 and the S&P 500 dropped 0.15 percent to 1,404.77 after a brief foray into positive territory. January manufacturing activity was higher, with the Supply Management index at 52.3 in January, higher than the reading of 50 that had been expected and much better than the 49.2 level reported in December. A reading above 50 denotes expansion while anything below 50 signifies that the sector is contracting.

Crude oil prices were higher at midday in New York, with West Texas Intermediate crude for April delivery 50 cents higher to $62.29 per barrel on the New York Mercantile Exchange. April contracts for Brent crude were up 59 cents to $62.48 in London. Among other worries in the sector was a new report from the US National Oceanic and Atmospheric Administration that said the coming summer’s hurricane season could be much more active than last year’s quiet season. Hurricanes in the Gulf of Mexico could shut down production and interrupt supplies of oil and natural gas. In other commodities, precious metals prices were mixed but mostly higher. The exception was platinum, which was down by $4.40 to $1,252 per troy ounce for April contracts.

Among currencies, the yen was much stronger during the day as Asian equities markets continued to decline. About the only exception to the yen’s gains was a decline against the US dollar, which also strengthened during the day.

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