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Post by Emperor AAdmin on Oct 10, 2008 13:22:40 GMT -5
Emerging markets tumble; some countries shut trading 1:33p ET October 10, 2008 (MarketWatch)
NEW YORK (MarketWatch) -- Stocks in emerging markets plunged Friday, forcing trading suspensions on numerous exchanges, as a collapse in investor confidence and fears about a global recession triggered panic selling around the world, from Thailand and India to the Czech Republic and Turkey.
Stock exchanges in Iceland, Indonesia and Russia remained closed Friday, while steep declines forced the halt of trading in Thailand, Austria, Romania and Brazil.
"It has been a morning of equity-market carnage," said analysts at RBC Capital Markets in a research note. "Panic has taken over as the credit crisis has compounded fears of a long, drawn-out economic recession."
In the debt markets, the EMBI+ spread index soared 31 basis points to 567 basis points, according to data from RBC Capital Markets.
In Eastern Europe, Russian markets were still closed. The Czech Republic's PX stock index fell 15% and Poland's WIG 20 stock index dropped 8%. Turkey's IMKB-100 stock index declined 8%.
After dropping sharply earlier Friday, Hungary's BUX stock index reclaimed some ground to end down 3%.
In Romania, the Bucharest Stock Exchange was closed for trading during most of the session on Friday. The BET stock index tumbled 10%.
"The heavy selling continued in CEE [Central and Eastern Europe], and the markets here were dominated by fear," said Adrian Ciocoi, Bucharest-based head of research for emerging Europe at Riedel Research Group.
"Confidence is pretty much rock-bottom and investor sentiment is low," Ciocoi said in emailed comments. "The financial markets were knocked down and the white towel is going to be thrown... increasing signs of capitulation."
In Latin America, Brazil's Bovespa stock index tumbled as much as 10% in early trading, forcing the exchange to suspend trading for half an hour because of a circuit breaker. After trading reopened, the Bovespa was last down 7.3%.
Elsewhere in the region, Chile's IPSA index fell 7%, Mexico's IPC index dropped 4% and Argentina's Merval declined 6%.
In Asia overnight, markets tumbled, with Japan's Nikkei and Thailand's SET indexes leading the declines. The SET index ended down 10% after halting trading temporarily due to circuit breakers.
India's Sensex stock index fell 7%. Hong Kong's Hang Seng index also tumbled 7%, while China's Shanghai Composite index fell 3.6%. See Asia Markets.
The iShares MSCI Emerging Markets Fund , which tracks the performance of the MSCI Emerging Markets index, fell 4% in intraday trading.
The Market Vectors Russia ETF , which tracks the Russian stock market, fell 5%. The iShares MSCI Brazil ETF dropped 7%.
The prices of many commodities fell sharply Friday, with the Reuters/Jefferies CRB Index , a benchmark gauging the prices of major commodities, fell 4.2%. Oil prices tumbled below $80 a barrel to a one-year low. See Futures Movers.
Many emerging economies, such as Russia and Brazil, are major commodity exporters, and the recent plunge in commodities prices has taken its toll on them. www.marketwatch.com/
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Post by Emperor AAdmin on Oct 10, 2008 13:25:34 GMT -5
U.S. stocks tumble as shaken investors pull out of equities 2:04p ET October 10, 2008 (MarketWatch)
NEW YORK (MarketWatch) -- U.S. stocks on Friday plunged for an eighth straight day in a wild trading session that saw the Dow Jones Industrial Average fall more than 500 points three times to under 8,000 only to battle back as fears escalated that the trauma in the credit markets could be paving the way toward a global recession.
The Dow industrials were recently off 509 points, or 6%, at 8,072, with 26 of its 30 components trading lower. Shares of oil giant Exxon Mobil Corp. paced the blue-chip decliners, down 11.2%.
"What we've seen here was one big margin call that just kept feeding on itself, so the opposite could happen. But you need a catalyst," said Peter Cardillo, chief market economist at Avalon Partners.
Pacing the blue-chip gains was General Motors Corp. , which rose 1.3% after falling to below $5 a share the prior session for the first time in 58 years, with Standard & Poor's putting the auto maker's debt on negative credit watch late Thursday.
Bank of America Corp. gained the most on the Dow, its stock rising 2.5%.
Another blue chip, General Electric Co. , erased an early bid higher, recently off 0.5%, after reporting a third-quarter profit that met Street expectations, and said it was on pace to meet its recently revised projections for 2008.
"A psychiatrist is what is needed to help investors today," said Tony Crescenzi, chief bond market strategist at Miller Tabak & Co.
The Dow industrials first plunged nearly 700 points to trade below 8,000 for the first time since April 1, 2003, but bounced back, briefly rallying into positive territory only to dip again before an hour of trading had passed.
"I'm more convinced now than ever that this market has made a bottom. The capitulation came when we breached 8,000," said Cardillo.
"It doesn't mean we can't go back and revisit that level," Cardillo added.
The short-lived trip into the green prompted cheering on the floor of the New York Stock Exchange.
"There was cheering as the market was recovering and it wasn't the meltdown we saw in the Asian markets," said Paul Nolte, director of investments at Hinsdale Associates.
The S&P 500 fell 53.2 points, or 5.8%, to 856.72, with energy, utilities and telecommunication services fronting sector losses that stretched across all 10 of the index's industry groups.
Standout gainers in the battered financial sector included XL Capital Ltd. , up 26.5%, and Wachovia Corp. , ahead 22.9%.
Noteworthy decliners included Morgan Stanley , recently off 39.4%, with its shares hit again after Moody's Investors Service put the long-term ratings of Morgan Stanley and its subsidiaries on review for downgrade. Read more.
Adding to retail-sector woes was Macy's Inc. , its stock off 12.4%, after the department-store operator slashed its sales and profit forecasts. Read more.
The Nasdaq Composite shed 78.82 points, or 5%, to 1,566.3.
New normal?
"The CBOE Volatility Index is up another 7.93 to 71.85 and record highs, suggesting that few investors expect a return to normal market conditions anytime soon," said Frederic Ruffy, options strategist, WhatsTrading.com.
Volume on the New York Stock Exchange topped 1.3 billion, with 10 stocks falling for every one on the rise. On the Nasdaq, 964 million shares changed hands, and decliners outran advancers nearly 5 to 1.
"We can talk about the credit crisis or the economy moving into a global recession, but there has been forced selling into an otherwise completely illiquid market," said Pado.
In Washington, finance ministers and central bankers from the Group of Seven nations are meeting, with economists looking to the gathering for coordinated measures to encourage banks to resume lending to each other.
In economic data now virtually ignored by panicked investors had the Labor Department reporting a September decline in U.S. import prices.
A separate report from the Commerce Department showed the U.S. trade deficit narrowing in August.
"There is no doubt that as the global economy slows, exports from the U.S. will weaken," said Stephen Stanley, Chief Economist at RBS Greenwich Capital.
The global economic fears also fueled a sell-off in crude, with oil futures sliding to $80.27 a barrel, down $6.32, after falling to a one-year low of $78.61 earlier. Treasury prices also fell, sending yields up for a fourth straight session, as worries that moves to stabilize the flailing financial system will lead to more debt issuance, curbing the value of bonds already held. Read Bond Report.
Central banks around the globe this week axed interest rates in a synchronized effort to thaw frozen credit markets, with the week of carnage prompting shares to tally another massive one-day fall in Europe.
Asian markets were also dealt crushing blows, with Japanese shares hardest hit.
Stocks in emerging markets plunged, forcing trading suspensions in multiple exchanges, as the collapse in investor confidence triggered panic selling around the globe. www.marketwatch.com/
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