BANGALORE: Indian shares slumped to a 33-month low on Wednesday in the wake
of terror attacks in the United States, leaving investors shocked and
heightening worries the global economy could slip into a recession, brokers
said.
But a day after suicide attacks demolished New York's signature World Trade
Center and smashed a hole through the Pentagon in Washington, analysts advised
keeping calm, recommending investing from a medium-to long-term perspective.
Technology stocks were the hardest hit as investors feared the attacks in the
United States would further dent demand for Indian software companies' services
in their largest market. Sentiment on tech shares was also downbeat as US
markets, which are closed on Wednesday, could reopen on a plaintive note later
this week.
But investors remained edgy, with the benchmark 30-share Bombay Stock
Exchange index finishing at 3,032.71, down 3.74 per cent on the day, and down
23.65 per cent from the start of the year. The index recovered from its
intra-day low of 2,954.35 points - down 6.22 per cent at that point - as
investors, led by domestic funds, hunted for bargains.
Both the intra-day and closing levels were the lowest since December 24,
1998, despite the market regulator announcing temporary price filters on the
index and 53 leading shares until further notice.
UK: Shares rebound in aftermath
London's leading shares fought their way higher in volatile and at times
emotional trade on Wednesday as investors absorbed the shock of Tuesday's terror
attacks in the United States. The blue-chip FTSE 100 index seesawed in a
230-point range and surged in late trade to end up 136.1 points or 2.87 per cent
at 4,882.1, battling back from three-year lows after a near 10 per cent slide
from Tuesday's high before the attacks.
China: HK stocks slump over 7%
Hong Kong stocks plunged on Wednesday to their lowest levels since early 1999
after the attacks. The Hang Seng Index was down 7.28 per cent at 9,659.15 28
minutes after the start of trading, after diving over 10 per cent shortly after
the open. Tokyo's key benchmark index fell five per cent while Singapore stocks
dropped 6.5 per cent. Hong Kong traders were buying the local currency and
selling the US dollar in early Wednesday trade. Dealers said the Hong Kong
dollar was bid at 7.7988 per US dollar, firmer than Tuesday's closing levels of
7.7999.
Japan: Steep fall in Nikkei
The Nikkei share average ended down 6.63 per cent at 9,610.10, its lowest close
since December 1983, on the back of the devastating terror attacks in the United
States that sent shock waves through global markets. It was the Nikkei's
eighth-largest percentage decline ever. The latest plunge in Tokyo stock prices
on Wednesday is likely to prompt more firms to postpone or cancel plans to debut
on Japan's already lackluster market for initial public offerings (IPOs),
analysts said.
Netherlands: Dutch Aex down
The AEX index fell in the morning to its lowest level since November 1998 at
438.88 points, then flipped up to a intra-day peak of 463.52 points, up three
per cent, before crumbling again. At 1245 GMT the AEX was trading down 2.03 per
cent at 440.81. The Dutch blue chip index whip-sawed on Wednesday lurching back
to early lows in the afternoon on disappointment that the European Central bank
was in no hurry to cut interest rates. A swathe of stocks with heavy exposure to
the United States extended losses while a few shares such as KPN Telecom and
brewer Heineken bucked the trend. Analysts at ING Barings said in a research
note that the timing of the attacks could not have been worse since fears of a
global recession were already rife.
Sweden: Nordic shares reverse losses
Nordic shares reversed early losses on Wednesday when shares that had been
battered after Tuesday's terrorist attacks in the US rebound tentatively, led by
security-related firms that could see extra business. Telecom equipment
heavyweights Nokia and Ericsson , battered on Tuesday after hijackers crashed
passenger jets into US landmarks and ignited fears for world stability, both
rose into the black.
(With inputs from Reuters)