The financial crisis hits Europe

Mon, Oct 6 2008, 09:43 GMT
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FXstreet.com (Barcelona) – European Governments are acting fast in order to prevent the worst consequences of the global financial crisis hitting their economies, among fears of negative news from several banks in Europe, stock markets have already been affected by gloomy perspectives and the Euro is dropping to long term lows against the Dollar and the Yen.

Asian Markets have been the first ones to feel the impact, with the Nikkei 225 index has closed the day with a 4.25% fall, Shangai’s stock exchange has declined 2.78% in the first hour after the opening. In Australia, the Standard & Poor’s/Australian Stock exchange 200 in Sydney has posted a 3.3% decline.

In Europe the session seems to be heading for another “Black Monday”, as the London FTSE stock market plummeted 5% in the first minutes of trading, dropping 475 points to 4375, Frankfurt’s stock exchange has also opened with a 4.40% decline, Paris stock market has plunged 4.82% and Milan posted a 3.13% decline minutes after the opening.

Banks, as expected, have been dragging down the markets, in England HBOS’ stocks fell 16%, while the Bank of Scotland posted a 12% decline, while in Brussels and Amsterdam, stocks from the Fortis Bank have been suspended to evaluate the banks acquisition by BNP Paribas.

The Euro has also followed the tide, and has continued running down slope against the Dollar, posting the 14-month low against the Dollar, and a two year low against the Yen, in a signal that the market does not feel at ease with the lack of a common economic plan for the whole European Union

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