Wall Street braced for tumble
The American stock market was expected to plunge at the opening of trading today, extending its huge losses from last week and taking more cues from heavy selling that has spread throughout the world.
Indicators showed the Dow Jones industrial average was set to fall by about 500 points when trading begins at 14.30GMT.
Fears of a recession in the US that could pull down the global economy as well have infected markets around the world, and those declines further unnerved US investors who were unable to trade yesterday, when Wall Street was closed for the Martin Luther King Jr. Day holiday.
Dow Jones industrial average futures fell 476, or 3.93%, to 11,630. Standard & Poor’s 500 index futures fell 57.30, or 4.32%, to 1,628.00. Nasdaq 100 index futures dropped 77.00, or 4.16%, to 1,772.50.
In Asia, Japan’s Nikkei stock average closed down 5.65% and Hong Kong’s Hang Seng index lost 8.65% a day after showing its biggest losses since the September 11 attacks.
In late morning trading, Britain’s FTSE 100 rose 0.55 percent, Germany’s DAX index fell 0.97% and, France’s CAC-40 rose 0.47%.
Some of the more modest moves in major global indexes today belied the huge drops many saw yesterday. Some of the gains came amid speculation that central banks around the world would step in with co-ordinated interest-rate reductions to help shore up jittery markets.
A big question is whether the Federal Reserve, scheduled to meet next week, will make an emergency interest rate cut before then.
Last week, each of the major US indexes fell more than 4% as investors grew sceptical late in the week that plans by President George Bush to stimulate the US economy will keep the US from tipping into recession.
The dollar was mixed against other major currencies, while gold prices rose.
