Global stocks tumble as investors flee for safety

October 23, 2018 | By | Reply More

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LONDON: Global stocks tumbled today as investors fled for safety while they worried about US earnings, Italy’s finances and trade tensions, and as pressure mounted on Saudi Arabia over the death of journalist Jamal Khashoggi.

US stocks joined the global selloff, falling sharply in early trading. The Dow Jones Industrial Average was down 1.7% at around 1445 GMT, after earlier sinking more than 2%. The broad-based S&P 500 fell 2.0%.

Earlier, European stocks picked up where Asia left off. At about 1330 GMT, London’s FTSE 100 was down 1.1%, Frankfurt’s DAX 30 was 2.3% weaker and Paris’ CAC 40 lost 1.5%.

Frankfurt was dragged down by a plunge in the share price of chemicals and pharmaceuticals giant Bayer after a US court confirmed a previous cancer damages ruling against subsidiary Monsanto over its herbicide Roundup.

On the geopolitical front, pressure is growing on Saudi Arabia after it admitted that Khashoggi had been killed at its Istanbul consulate.

Turkish President Recep Tayyip Erdogan said today the “savage murder” of Khashoggi at the Saudi consulate in Istanbul was meticulously planned, demanding that all those linked to the killing face punishment.

Earlier, on Asian stock markets, Shanghai sank 2.3%, having jumped more than 6% since Thursday’s close, while Hong Kong fell 3.1%. Tokyo plunged 2.7%, Sydney lost over 1% and Singapore fell 1.3%. Seoul dived 2.6% and Taipei was 2% off.

There were also steep losses in Manila, Mumbai and Jakarta.

“Global financial markets continue to struggle to rally as various geopolitical concerns weigh on investor confidence,” said Nick Twidale, chief operating officer at Rakuten Securities Australia.

In the currency market, the US dollar fell after Wall Street opened lower, spurring a risk-off move that benefited the safe-haven Japanese yen and Swiss franc against the greenback.

At mid-morning in New York, the dollar was down against the yen by 0.71%, last trading at ¥111.99. Against the Swiss franc the dollar was down 8 basis points, last at 0.995 francs. The dollar index, a gauge of its value against six major currencies, fell 5 basis points to 95.976.

Oil prices dived after Saudi Arabia said it could supply more crude quickly if needed, reassuring investors. In New York trading, Brent crude futures dropped 2.8%, or US$2.27, to US$77.56 a barrel by 1521 GMT after plunging to US$77.50, the lowest since Sept 18. US crude fell US$1.98, or 2.9%, to US$67.38 a barrel, after hitting a session low of US$67.26, the lowest level since Sept 7. – Agencies

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