Markets Continue to Slide on Growing Credit Concerns

U.S. stocks have plunged the past two days after news from Europe showed the full extent of the credit crunch. Inter-bank rates in Europe shot way above target, causing the European Central Bank to inject billions of dollars in an effort to bring liquidity to cash-strapped markets.

Wall Street reacted negatively, as the Dow dropped over 300 points yesterday. Financials have been hit the hardest, with brokerage and banking stocks losing significant amounts of value.

Currently, the major averages have moved off of their intraday lows but continue to see downward pressure.

Crude oil futures for September delivery continued to fall losing 1.3% to $70.64 a barrel on concerns that reduced economic growth will hamper fuel demand. Gold futures for December delivery rose 1% to $679.30 an ounce.

Around Asia, Shanghai's Composite fell fractionally to close at 4,749.37, Hong Kong's Hang Seng index lost 2.9% to 21,792.71, and Tokyo's Nikkei index dropped 2.4% to 16,764.09.

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Darren Wong
Associate Editor
darrenw@tradingmarkets.com

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