Debt crisis: stock markets panic – live blog

• Almost £50bn wiped off leading FTSE shares on Thursday • Huge sell-off on Wall Street hits Dow Jones • Turmoil sweeps through Asian stock exchanges My colleague Jill Treanor reports that Stephen Hester, chief executive of Royal Bank of Scotland, urged markets to stay “calm” in the face of market turbulence as the bailed out bank slumped to a £794m first half loss. Results were impacted by a £733m hit on Greek bonds and a £850m provision for payment protection insurance. RBS shares slumped nearly 14% to 26.05p this morning. 8.12am: In Italy, shares in the country’s biggest bank Unicredit have been suspended for excessive losses after falling nearly 6%. Shares in Intesa Sanpaolo, which is due to report first-half figures later today, were also suspended after falling 7.7%. Europe’s banking stock index tumbled 3.6%. Bond markets are going crazy too with yields hitting new record highs. The interest rate, or yield, on 10-year Italian government bonds has spiked 15 basis points to 6.38% while the Spanish yield is up 10 points at 6.42% and the Portuguese yield is 16 points higher at 13.1%. 8.04am: The FTSE 100 tumbled more than 170 points in early trading, a drop of 3.3%, to 5217. The interest rate on UK ten-year government bonds, known as gilts, fell to a record low of 2.59%. France’s CAC lost 3.1%, Spain’s Ibex 2.2% and Italy’s FTSE MIB 3.3%. 7.55am: Richard Hunter, head of UK equities at Hargreaves Lansdown stockbrokers, said markets could fall further today, especially if key jobs data from the US reveals a further slowdown in the economy. Hunter said: Investors are pessimistic at the moment, the general market mood is to try to prepare for the worst. It’s difficult to see anything positive coming from the data today unless they reveal absolutely barnstorming figures. Non-farm payrolls for July, released at 1.30pm London time, are expected to show weak job growth in the US (a rise of 85,000 jobs after June’s dire 18,000 increase) while the unemployment rate is expected to stay at 9.2%. On this side of the pond, French President Nicolas Sarkozy will hold crisis talks discussing financial markets with German Chancellor Angela Merkel and Spanish Prime Minister Jose Luis Rodriguez Zapatero. 7.35am: Good morning. We will bring you the latest news and commentary today as stock markets are braced for further falls amid fears that the world economy could slide back into recession. Thursday was a day of global stock market mayhem, which saw the FTSE 100 index suffering its worst daily fall since March 2009 as the eurozone and US debt crises took their toll. Nearly £50bn was wiped off the value of Britain’s 100 biggest companies and traders said the atmosphere was ominously reminiscent of the banking crisis of autumn 2008. In Asia, Japan’s Nikkei lost 3.7% to 9299.88 overnight while Hong Kong’s Hang Seng tumbled 5.1% to 20,761.98 and the Taiwanese stock market was down 5.6% at 7853.13. To recap: The FTSE 100 in London lost 191.37 points , or 3.4%, to 5393.14 yesterday. On Wall Street, the Dow Jones closed more than 500 points , or 4.3% lower at 11,383 – the biggest single-day loss since 2008. Comments from the president of the European commission, José Manuel Barroso, did little to calm markets. “We are no longer managing a crisis just in the euro area periphery,” he said yesterday. “Euro area financial stability must be safeguarded.” He urged European leaders to review “all elements” of the €440bn (£382bn) European financial stability facility and its €500bn replacement, the European stability mechanism. Stock markets United States US economy Economics European debt crisis Julia Kollewe guardian.co.uk

Posted by on August 5, 2011. Filed under News, Politics, World News. You can follow any responses to this entry through the RSS 2.0. You can skip to the end and leave a response. Pinging is currently not allowed.