Wednesday, August 10, 2011

Asian stocks drop after US and European indexes decline: Panic is spreading throughout world

Asian shares have fallen, after declines in the US and Europe, amid fears that the financial crisis is spreading to bigger economies.

Japan's Nikkei 225 index, South Korea's Kospi and Australia's ASX all fell more than 1%.

The latest sell-off was triggered by rumours that France may become the next country to lose its triple A credit rating.

There was also speculation that one of its biggest banks was in trouble.

Analysts have warned that markets are likely to remain choppy in coming sessions.

"We have had volatile markets in the past that have headed in one direction, but this time around no one seems to know what is going to happen," Andrew Robinson of Saxo Capital Markets told the BBC.

"On Tuesday, you had the Dow Jones up by 4%, if had you asked me then, I would have said it looks like we have bottomed out.

"But you wake up this morning to find that it is down by the same magnitude again." (more)