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Dubai: Asian and European stock markets plunged yesterday as nervous investors fretted over the sliding dollar and more fallout after the meltdown of investment giant Bear Stearns.
Most European shares were down by at least two per cent, while the main Hong Kong share index plunged over five per cent and the key Indian index BSE Sensex fell by 6 per cent.
An emergency Sunday cut by the US Federal Reserve on its discount rate and a weekend deal for JPMorgan Chase to buy investment bank Bear Stearns at a fire-sale price created a sense of crisis sweeping through global markets. Despite the Asian retreat, Wall Street traders kept cool as US share prices opened sharply lower but rebounded to show modest declines in late morning trade with indices showing brief swings into positive territory.
Profit booking
At 1445 GMT, the Dow Jones Industrial Average was off a modest 6.92 points (0.06 per cent) to 11,944.17, coming back from opening losses of nearly 200 points.
The Nasdaq composite shed 20.40 points (0.92 per cent) to 2,192.09 and the Standard & Poor's 500 index lost 8.29 points (0.64 per cent) to 1,279.85.
Gold pared most of its gains yesterday, as investors took profits from a rally to record highs above $1,030 and a sharp drop in oil prices lowered the metal's appeal as an inflation-hedge. Spot gold was quoted at $1,006.80/$1,007.00 an ounce at 1420 GMT after falling to a low of $998.90. Earlier, it hit a record high of $1,030.80, against its close of $996.90/$997.70 in New York late on Friday.
Oil dropped from a record high yesterday as a part of wider commodity sell-off. US crude was trading at $106.87. Earlier yesterday, it hit a record $111.80 and then fell to a session low of $105.11.
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