European shares slip amid report of stock market crash warning

#1
Wed Jun 18, 8:27 AM ET

LONDON (AFP) - European equities fell Wednesday after sharp overnight US losses as sentiment was also hit by a report that a Royal Bank of Scotland analyst had warned of a global market crash.

In late morning trading, London's FTSE 100 index of leading shares slid 1.53 percent to 5,772.50 points.

The Paris CAC 40 index sank 1.23 percent to 4,628.50 points and Frankfurt's DAX 30 index shed 0.67 percent to 6,750.31 near the mid-way point.

The Euro Stoxx 50 index of top eurozone shares lost 0.98 percent to 3,520.59 points.

The European single currency stood at 1.5485 dollars.

Wall Street tumbled Tuesday as data showing inflation heating up and housing still fragile offset surprisingly good earnings from investment bank Goldman Sachs.

Tokyo shares bucked the trend, jumping higher on Wednesday as a weaker yen boosted exporters, dealers said.

In Britain, The Daily Telegraph reported that an analyst working for Royal Bank of Scotland (RBS) had advised clients to prepare for a full-fledged crash in global stock and credit markets in the next three months amid soaring inflation.

However, an RBS spokeswoman told AFP that the report did not reflect the view of the bank.

"A very nasty period is soon to be upon us -- be prepared," said Bob Janjuah, senior RBS credit strategist, in a report to clients that was published in the daily newspaper.

The RBS report also warned that New York's broad-market Standard & Poor's 500 index could shed more than 300 points to around 1,050 points by September.

In European trade, financial sector fell sharply on Wednesday.

RBS saw its share price dive 3.52 percent to 232.75 pence and banking peer Lloyds TSB fell 2.60 percent to 347 pence.

In Paris, French banks Credit Agricole and Societe Generale shed 2.31 percent and 2.53 percent to stand at 13.53 euros and 58.48 euros respectively.

Back on Wall Street, traders were waiting for quarterly results from US investment bank Morgan Stanley due Wednesday, after better-than-expected earnings at Goldman Sachs.

"Goldman's better-than-expected earnings raised hopes that Morgan Stanley's earnings may not be bad either," JPMorgan strategist Masaru Ohnishi told Dow Jones Newswires.

The Goldman results, however, failed to lift Wall Street on Tuesday, when the Dow Jones index slipped 0.89 percent after data showed a rise in wholesale inflation and ongoing problems in the housing sector.

The Nasdaq composite retreated 0.69 percent to 2,457.73 and the Standard & Poor's 500 index shed 0.68 percent to end at 1,350.93 points.

In Asia on Wednedsday, Tokyo's benchmark Nikkei-225 index climbed 0.73 percent to end at 14,452.82 points.
 
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#3
Market crashes mean relatively little. Market going up by a few 100 points also mean little when you live with a trash currency. There will be a significant amount of human suffering in this race to the bottom, led by the Federal Reserve, cheer leaded by RBI. There has already been food riots in 37 countries. May be it is about time I get some of my calls wrong.


Whether these happen or not, helps to stack up on canned food, grains etc and be prepared.


Here are those articles.

http://www.telegraph.co.uk/money/main.jhtml?xml=/money/2008/06/18/cnrbs118.xml

http://www.telegraph.co.uk/money/main.jhtml?xml=/money/2008/06/16/bcnecb116.xml
 
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sudoku1

Well-Known Member
#4
Market crashes mean relatively little. Market going up by a few 100 points also mean little when you live with a trash currency. There will be a significant amount of human suffering in this race to the bottom, led by the Federal Reserve, cheer leaded by RBI. There has already been food riots in 37 countries. May be it is about time I get some of my calls wrong.
A slow drifting mkt is even more poisonous than a crashing one as it does not allow u 2 breathe freely.....:Dthe current situation is xactly the same.....
 
#5
A slow drifting mkt is even more poisonous than a crashing one as it does not allow u 2 breathe freely.....:Dthe current situation is xactly the same.....
Yes, even though shorts ( I meant stocks ) make money in general in this environment, need to watch out for short squeezes and the occasional rallies.
Happiest animals in the planet...Bears:) don't know when that will change...except in a hyperinflationary environment in which case NIFTY will be 10k and tomatoes will cost Rs 500 a kg, and I hope we don't get to that..

It is also interesting to see that these "experts" , especially from brokerages regularly advise people to buy stocks and say that the worst is over. You can find several instances in moneycontrol, sify etc over the past few months - helps their business.
 
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sudoku1

Well-Known Member
#6
even though shorts ( I meant stocks ) make money in general in this environment, need to watch out for short squeezes and the occasional rallies.
Happiest animals in the planet...Bears:) don't know when that will change...
it will change only the day sensex closes abv 16400;)
 

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