Stocks in Europe, Asia Sank


Stocks in Europe and Asia and U.S. index futures sank after negotiations on the $700 billion financial bailout plan stalled and Washington Mutual Inc. was seized in the biggest U.S. bank failure in history.

UBS AG, the European bank hardest hit by subprime-related losses, slid 4.4 percent and Woori Finance Holdings Co., which controls the second-largest bank in South Korea, tumbled 7.5 percent after Republicans said they wouldn't support the proposed rescue plan. WaMu plunged 92 percent as JPMorgan Chase & Co. acquired its branch network for $1.9 billion. Vestas Wind Systems A/S retreated 9.2 percent after Morgan Stanley cut its recommendation for the world's biggest wind-turbine producer.

Europe's Dow Jones Stoxx 600 Index decreased 2.7 percent to 263.79 at 1:37 p.m. in London, extending the drop this week to 5.2 percent. Futures on the Standard & Poor's 500 Index expiring in December sank 2.2 percent, while the MSCI Asia Pacific Index slipped 0.5 percent.

Stocks extended losses after a report showed the U.S. economy expanded at an annual rate of 2.8 percent in the second quarter, slower than the previously estimated 3.3 percent.

U.K. stocks dropped, led by banks, after negotiations on the $700-billion plan to bail out financial markets in the U.S. stalled. The benchmark FTSE 100 index fell 116.52, or 2.2 percent, to 5,080.50 as of 12:35 p.m. in London, headed for a weekly loss of 4.3 percent.

China's stocks rose, with the benchmark index advancing for the first week in nine, after the government stepped up support for the world's second-worst performing market this year. The CSI 300 Index, which tracks yuan-denominated A shares listed on China's two exchanges, advanced 20.13, or 0.9 percent, to 2,243.66 at the close.

Indian stocks
fell, with the benchmark posting its biggest weekly drop in six months, after talks on a U.S. credit market rescue plan stalled and Washington Mutual Inc. became the biggest bank failure in American history. The Bombay Stock Exchange's Sensitive Index, or Sensex, fell 445, or 3.3 percent, to 13,102.18.

Japan's Nikkei 225 Stock Average lost 0.9 percent to 11,893.16. New Zealand's NZX 50 Index declined 1.6 percent after the economy contracted in the second quarter, driving the nation into its first recession in a decade.


TradingEconomics.com, Bloomberg.com
9/26/2008 6:09:04 AM