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World markets plunge on US recession fears - Times Online

More than £77 billion was wiped off the value of Britain's stock market yesterday in its biggest one-day percentage loss since September 11, 2001. Shares across the world plunged over fears that the threatened US recession will undermine the global economy.

London's leading shares tumbled by 5.5 per cent in brutal market conditions, with the FTSE 100 index losing more than 323 points, its steepest points fall on record, to end the day at 5,578.2.

George Soros, the billionaire investor who prompted Britain's withdrawal from the European exchange-rate mechanism on Black Wednesday in 1992, said the situation was "much more serious than any financial crisis since the end of the war". Investors were "drowning in a sea of red," said Henk Potts, an equity strategist at Barclays Stockbrokers.

The losses in London and across Europe came as global markets remained fearful that President Bush's plans for tax cuts to stave off a US recession would not give a big enough boost to growth. Warnings from two leading US banks that the losses from America's sub-prime home loans crisis were spreading to China triggered a sell-off of shares in Asia, which quickly rippled around the world.

[Murdoch Alert]
by Fran on Tue Jan 22nd, 2008 at 12:06:33 AM EST
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Seen in the figaro in France, from french COFACE chairman (state based company specialised in export risk insurance)

«Pas de récession aux États-Unis cette année»

No recession in US this year

Aujourd'hui, nous constatons une augmentation lente des défauts de paiements, ce qui devrait, selon nous, amputer la croissance mondiale de 0,3 à 0,4 point de base. Nous ne croyons pas au scénario d'un recul du produit intérieur brut (PIB) pendant deux trimestres consécutifs, qui constitue la règle pour qualifier une récession.

Today, we can see a slow increase in US companies failure to pay debts, which could lead to a decrease around 0,3 to 0,4 GNP points. We do not believe to the two quarters long GNP decrease, which is how is qualified a recession.

I beg your pardon for the translation, which is a bit awkward, but I'm just posting this before going to a meeting, and it ma have been a bit quick.

by Xavier in Paris on Tue Jan 22nd, 2008 at 02:48:16 AM EST
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