Global shares go into a tailspin; Dow crashes over 300 points

Global stock markets slumped, with America’s benchmark Dow Jones Industrial Average plunging over 300 points intra-day on the first day of major trade today after S&P downgraded US sovereign credit rating.

Hit hard by financial uncertainty, Dow Jones index crashed over 304 points or 2.66 per cent to 11,140.40 points in the morning trade. Similarly, S&P 500 tumbled over three per cent to 1,158.97 points while the tech-heavy Nasdaq Composite index plummeted 3.6 per cent to 2,441.45 points.

Apart from the historic downgrade of the US credit rating on Friday, aggravating debt turmoil in Europe has added to the woes of investors.

Shedding marginal gains in early morning trade, key European stock markets declined as much as four per cent in late afternoon session.

London Stock Exchange’s FTSE 100, Germany’s Dax and France’s benchmark Cac 40 dropped as much as four per cent, despite European Central Bank’s plan to purchase government debt from debt-laden nations in the region.

Most of the Asian markets witnessed heavy sell-off even as there were some kinds of buying at lower levels in markets such as India.

Chinese benchmark Shanghai SE Composite index, which plunged 3.79 per cent to close at 2,526.82 points. South Korea’s key Kospi index and Singapore’s FTSE Straits Times Index fell over three per cent to close at 1,869.45 points and 2,884 points, respectively.

Japan’s key Nikkei index shed over two per cent to end the day at 9,097.56 points, while Hong Kong’s Hang Seng index plummeted more than two per cent to 20,490.60 points.

Among the major Asian indices, India’s 30-share Sensex saw one of the lowest losses. Recouping some of its early morning losses, the benchmark index closed at 16,990.20 points, down 1.82 per cent.

Global ratings agency S&P downgraded the sovereign ratings of the US to ‘AA+’ from ‘AAA’ on Friday, triggering widespread concerns about the health of the world’s largest economy.

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