World Markets Still Jumpy

It’s been yet another rough day for world markets.  As AP Business Writer Colleen Barry reports, investors remain jittery about a possible double-dip recession in the US, and the on-going debt crisis in Europe.  A good way to begin analyzing today’s market jumpiness is to start with Barry’s roundup of what  global investors have been up to:

“In Europe, Britain’s FTSE 100 closed down 1 percent at 5,040.76 while Germany’s DAX fell 2.2 percent to 5,480. France’s CAC-40 ended down 1.9 percent at 3,016.99.

In the U.S., the Dow Jones industrial average was down 0.4 percent at 10,944 while the broader Standard & Poor’s 500 index fell 0.2 percent at 1,138. Futures markets had been predicting far bigger declines earlier…

Earlier, Asian shares also took a beating following the big retreat Thursday in Europe and the U.S.

Toru Yamanaka / AFP/Getty Images

Japan's Nikkei Index took a hit following a rough day for European and US markets.

Japan’s Nikkei 225 index dropped 2.5 percent to 8,719.24 and Hong Kong’s Hang Seng slid 3.1 percent to 19,399.92.

Mainland Chinese shares tracked losses elsewhere, with shares in coal, oil and cement leading the decline. The Shanghai Composite Index lost 1 percent to 2,534.36 after dipping almost 2 percent earlier in the day. The Shenzhen Composite Index lost 0.8 percent to 1,133.84.”

Barry also points out that European markets were able to make up a lot of their losses because Wall Street didn’t lose as much as investors originally thought it would.  But Europe’s definitely got a lot left to do in terms of resolving its debt crisis,


Frank Rumpenhorst / AFP/Getty Images

Markets continue to react as Eurozone countries and the European Central Bank struggle with getting their on-going debt crisis under control.

“A parallel concern [to a double-dip US recession] centers on Europe after a Franco-German summit earlier this week failed to persuade investors a convincing fix to the spiraling debt crisis was imminent. The leaders promised further economic integration but no concrete measures like eurobonds, which would spread the risk among the 17 nations using the common currency.”

Meanwhile, despite fears of a US recession rerun and the recent credit downgrading, US Treasuries are still gaining in popularity, as Nathaniel Popper and Tom Petruno of the Los Angeles Times report,

“The desire to shift money in the traditional haven of Treasury bonds Thursday led investors to accept the lowest-ever rate on a 10-year government bond. The yield briefly fell below the once unthinkable level of just below 2%. At the end of the day it was 2.06%, down from 2.17% a day earlier.”

And, as investors seek shelter in safe bets, good old gold is moving ever closer to the $2,000 per ounce mark.

As we’ve noted in a previous State Impact piece, these macroeconomic convulsions have a definite effect on New Hampshire’s economy–especially the export sector.  In a nutshell: The more people buy into US debt, the stronger the dollar gets, which weakens the country’s position as an exporter.


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