<< folks selling everything they can at any price >>
Clearly been going on for awhile now Dale and could well go further as more and more creative accounting news hit the market. "Which company books can you trust" kind of attitude. Can you imagine the reaction if IBM's books were found to be cooked. No suggestion here and let's hope not.
Those o'seas fund managers who can do so (according to the funds charter) continue to be sellers of US stock.
One of the funds I follow (with vested interest) is short the US market to a tune of 33% of the funds total investments.
In currencies they are long Korean Won, Swiss Franc, Euro and A$.
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GLOBAL MARKETS-Stock rout deepens as accounting woes spread
12:48, Thursday, 11 July 2002
By Richard Baum
SINGAPORE, July 11 (Reuters) - Financial markets were in
turmoil on Thursday after the deepening crisis of confidence in corporate accounting sent U.S. stocks tumbling to five-year lows.
News of a criminal probe into another U.S. telecommunications
company pummelled Wall Street stocks on Wednesday and sparked follow-through selling in Asia on Thursday.
The flight from U.S. equities left the dollar mired near a
10-month low against the yen and drove investors into the
relatively safety of government bonds, pushing yields to
multi-month troughs.
The rout sparked by the alleged $3.85 billion fraud at U.S.
long-distance telecoms carrier WorldCom Inc <WCOME.O> gathered
pace as investors gave a thumbs-down to U.S. President George W.
Bush's proposals to crack down on corporate corruption.
The disclosure on Wednesday that federal prosecutors had
launched an unspecified criminal probe into Qwest Communications
International Inc. <Q.N>, the fourth-ranked U.S. local phone
company, dealt a fresh body blow to confidence in the market.
The Dow Jones Industrial Average <.DJI> tumbled 282.59
points, or 3.11 percent, to 8,813.50, its largest one-day
percentage loss since September 2001.
The Nasdaq Composite index <.IXIC>, biased towards technology
companies, sank 2.54 percent to 1,346.01, its lowest since May
1997. The broad S&P 500 measure <.SPX> skidded 3.40 percent to
920.47, hitting its lowest level since October 1997.
Qwest shares lost a third of their value.
ASIA CAN'T DECOUPLE
Despite expectations that investors dumping U.S. stocks might
park their money in Asia, the region was unable to ignore the
fear that the market turmoil could hurt the U.S. economy and have
a knock-on effect in the East.
"I want Japanese stocks to decouple from the U.S., but the
speed at which money is running from the States is just too fast
right now for us not to take a hit," said Hiroshi Nishiyama,
senior portfolio manager at SG Yamaichi Asset Management in
Japan.
Tokyo's benchmark Nikkei average <.N225> was down 1.45
percent to 10,596.78 by late morning. Hong Kong's Hang Seng Index
<.HSI> was off 1.3 percent at 10,645.20, Singapore's Straits
Times Index <.STI> lost 0.7 percent to 1,620.29 and South Korea's
KOSPI <.KS11> gauge slumped 2.3 percent to 776.60.
Telecoms stocks were among the big losers.
The weakness of the dollar, hurt by foreign investors pulling
money out of the United States, has compounded problems for some
Asian economies by strengthening their currencies and threatening
the price competitiveness of their exports.
The dollar slid to another 10-month low against the yen on
Wednesday, at 117.37 yen, and rebounded by less than three
decimal points in Asian trade. The euro held around the 98.8-cent
level.
The Korean won firmed to levels unseen since November 2000,
while Taiwan's dollar reached ever high 13-month peaks.
Debt markets benefited from a flight to safety, with 10-year
U.S. Treasury yields falling to their lowest level of the year at
4.64 percent. Yields on five-year Japanese government bonds
<0#JPTSY=JBTC> dipped to 0.395 percent, the lowest since August
2001.
European shares sank for a third day running on Wednesday to
within sight of nine-month lows. The FTSE Eurotop 300 <.FTEU3>
slumped 3.1 percent.
((Asia Desk, +65 6870 3832, richard.baum@reuters.com)) |
