• Home
• /
• Economy
• /
• Business

Global stocks decline on growth fears

New York - Oil plunges 4% in New York

 World stocks turned lower on Wednesday, as sliding oil prices and fresh signs of global economic weakness weighed on investor sentiment.
In Europe, France's CAC 40 dropped 2.1 per cent to 4,147.76 points and Germany's DAX shed 2.4 per cent to 9,192.89 points. Britain's FTSE 100 dropped 1.6 per cent to 5,870.11 points .
Stocks are opening lower on Wall Street, led by declines in energy companies and banks as commodity prices fall.
Rig operator Transocean sank eight per cent in the first few minutes of trading on Wednesday. Miner Freeport-McMoran slumped seven per cent.
The Dow Jones industrial average dropped 181 points, or 1.1 per cent, to 16,250 points.
The Standard & Poor's 500 index fell 21 points, or 1.1 per cent, to 1,899 points. The Nasdaq composite gave up 55 points, or 1.2 per cent, to 4,448 points.
The price of oil sank four per cent to $30 a barrel in New York.
Bond prices rose. The yield on the 10-year Treasury note fell to 1.68 per cent.
Saudi Arabia's oil minister, Ali Al Naimi, told a meeting of energy leaders in Houston on Monday that output cuts aimed at boosting slumping crude prices won't work. He said that the market should instead let some operators go out of business. The long-term drop in oil prices, which are hovering around $30 a barrel after falling from over $100 in mid-2014, has sliced into profits at energy companies. It's also now starting to hurt income at big US banks as higher-cost producers struggle to repay loans taken out during the boom. "The disappearance of risk appetite after last week's positive performance can be traced to bad news around oil once again," said Bernard Aw, market strategist at IG.
Worries about the world economy are also weighing on investors' minds. Singapore and Hong Kong both reported on Wednesday that growth slowed last year and that their governments forecast further weakness for 2016 on softer global demand for their exports and services. Meanwhile, China's currency slipped as the central bank guided its exchange rate lower for the second straight day.
Japan's benchmark Nikkei 225 index lost 0.9 per cent to finish at 15,915.79 points as investors seeking haven in the yen pushed it higher, hurting shares of the country's big exporters. South Korea's Kospi edged 0.1 per cent lower to end at 1,912.53 points, and Hong Kong's Hang Seng fell 1.1 per cent to 19,192.45 points. The Shanghai Composite Index in mainland China rose 0.9 per cent to finish at 2,928.90 points. Australia's S&P/ASX 200 slid 2.1 per cent to 4,875.00 points. Benchmarks in Taiwan, Singapore, Malaysia and the Philippines also fell. - AP
The dollar fell to ¥111.82 from 111.97 yen in the previous day's trading. The euro weakened to $1.0965 from $1.1018.