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World markets tumble

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CIOL Bureau
New Update

NEW YORK: Stock markets throughout Asia tumbled today, the impact

of the terrorist attacks in America.

Many of Europe's exchanges

though vowed that it was business as usual come Wednesday despite the
attacks which destroyed both of New York's landmark World Trade

Center towers and hit the Pentagon.



In Asia: Tokyo share prices fell five per cent, Hong Kong stocks

dropped seven per cent and Australian markets were down four per

cent. The Tokyo Stock Exchange said on Wednesday it would suspend

trading in 15 stocks on its foreign section during Wednesday trade in

the wake of deadly attacks that forced Wall Street to stay shut a day

earlier.



The pan-European Euronext exchange ended trading as normal at 1530

GMT on Tuesday and said it would open for trade on Wednesday at its

regular hour of 0700 GMT.



"We have had other crisis situations in the past - the

invasion of Kuwait, for example. But the market is made to remain

open. To close the markets would add to the panic, and so the best

decision is to keep them open," a Euronext spokesman said.



Stocks and the US dollar plunged and safe-haven bonds soared on

Tuesday after two planes crashed into the World Trade Center in New

York and a further plane crashed next to the Pentagon in Washington

D.C. Investors, seeking safe havens in a time of uncertainty, drove

the prices of gold and oil and the Swiss franc higher in the wake of

the incidents.



Wall Street is expected to remain closed on Wednesday. "Investors

will be wondering if this the start of a terrorist campaign on the US

aimed at high profile institutions,'' said Andrew Milligan, head of

global strategy at Standard Life Investments in Edinburgh. "There

are no prices. There is no trade,'' said one emerging markets trader

in New York. "All the brokers are downtown in the Trade Center,

so there are no prices.'' A New York Stock Exchange spokeswoman said

the market opening was now indefinitely delayed.



Stocks are expected to drop sharply after a delayed opening on

Tuesday in the wake of a series of explosions that caused the

collapse of Manhattan's World Trade Center. "When the market

opens, it will open down a lot,'' said Stanley Nabi (news/quote), a

managing director at Credit Suisse First Boston (news/quote), which

oversees $110 billion.



Short dated European government debt yields plunged with the

two-year paper hitting near two-year lows after explosions in the

World Trade Center sparked flight to quality into government debt.

The disaster sapped liquidity from the euro corporate bond market as

investors fled into safe haven government bonds.



The dollar fell against both the euro and yen after the explosion.

The euro stood at $0.9050, compared to $0.8978 just before the first

explosions. The Swiss franc spiked briefly to 1.4901 to the dollar,

from opening levels around 1.6882, but fell back quickly to around

1.66. IPE Brent crude futures rose over three and a half dollars to

more than $31 a barrel, while gold prices rose over six dollars, or

two percent, to $278.00/$280.50 per troy ounce.

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