Market falls continue into second week
Global markets continued to fall after the weekend
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Monday, 05, Mar 2007 07:52
The weekend break failed to stop slips in global markets as European and Asian exchanges continued to suffer significant falls.
Britain's FTSE 100 index closed down 0.93 per cent, recovering from a slip to 1.73 per cent of its value during morning trading.
That follows Britain's index of leading shares losing nearly five per cent - almost £80 billion in value - since last Tuesday when the Shanghai stock exchange saw massive falls sparking a global sell-off.
Other European markets suffered today. The German Dax index slipped by 1.03 per cent while the French Cac index fell by 0.74 per cent.
"Most of what we saw today is a mark down. When you have such a big move in a short time, that is that is normally indicative of people wanting to readjust their risk positions," Michael Hughes, chief investment officer of Barings Asset Management, told the Today programme.
"We must remember that we have had a four year run now where the stock market has done a lot better than people anticipated, and so it is not so surprising that a few people would like to take a bit of profit towards the end of the tax year."
Shanghai's composite index lost 1.6 per cent of its value while the Japanese Nikkei closed down 3.4 per cent.
Speculation of a new law on stock market trading in China may have been the short-term trigger for the falls but economists have said underlying concerns about the strength of the US economy have sustained the losses.