Markets around the world absorb shockwaves

Markets tumbled again yesterday as Wall Street continued to be roiled by crisis. The reverberations spread as far as Moscow, where the government refused to open the stock exchange, after suspending trading the day before as global markets swooned. Authorities appear to be waiting for the global crisis to pass while they put together a US$44 billion (Dh162bn) rescue package. Elsewhere, the tone had been set by Wednesday's jittery Dow Jones performance, at least initially in Asia - with those markets suffering. The Japanese Nikkei 225 and Hong Kong's Hang Seng index both fell, though Tokyo came off worst, closing down 2.2 per cent, with its smaller neighbour ending just 0.03 per cent down, despite early tumbles of up to seven per cent. On Wall Street, shares of Morgan Stanley, which has followed Lehman Brothers and Merrill Lynch to the brink of failure, fell as low as $16.95, more than 20 per cent, in early New York trading. The investment bank was reported to be in talks with Wachovia, a mid-tier lender based in Charlotte, North Carolina. Overall, the Dow hovered about even in morning trading. GCC market losses were fairly muted, but generally continued downward. With the Saudi Tadawul closed for the weekend, the biggest player was out of the picture and it was left to the UAE markets to take the lead. The Dubai Financial Market closed down 3.02 per cent, wiping out the modest gains it made the previous day, and the same applied to the Abu Dhabi Securities Exchange, down 2.36 per cent. Other GCC stock markets were down half a per cent or so, except for Doha which plummeted 3.66 per cent and Kuwait, the only market in the region to make gains, closing up 0.44 per cent. Most European markets displayed few signs of Wednesday's panic. In general, their performances were dull, a relief for traders and investors who had become weary of so much excitement. Frankfurt was up nearly half a per cent, while Paris climbed three quarters of a per cent, making up their losses from yesterday. Still digesting the news of the HBoS-Lloyds TSB banking merger, London's FTSE index climbed half a per cent, buoyed by the announcement from the world's central banks that hundreds of billions of dollars would be pumped into the system. Wall Street opened up. For the moment, at least, it seemed that some sort of normality had resumed. afoxwell@thenational.ae