Saturday 3 December 2016

Markets tank and gold at record as investors fear slowing global economy

Published 03/08/2011 | 05:00

SHARES around the world plunged yesterday and gold hit new highs as concerns about the state of the global economy returned to haunt markets.

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Traders' relief that the US had come to an agreement to avert a default on its debts was overshadowed by sluggish economic data worldwide while the yield on Italian and Spanish 10-year debt surged past 6pc, signalling a possible return of the European debt crisis which appeared to be resolved after an EU leaders' summit in July.

The Stoxx 600 index of European shares fell 1.9pc to its lowest level since last August. London's FTSE 100 Index lost 1pc while France's CAC 40 tanked 2.3pc. By late afternoon the Dow was off 1pc. In Dublin, the ISEQ Index closed off 1.7pc for its seventh successive loss. Gold futures surged to a record $1,645.80 an ounce.

US Commerce Department figures showed consumer purchases fell 0.2pc in June, the first drop in almost two years.

That came a day after purchasing managers' indices showed global manufacturing was almost at a standstill last month.

"The focus has now shifted to the global economy with manufacturing deteriorating across most global economies," said Chris Weston, a trader at IG Markets in Melbourne.

Irish Independent

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