European Markets Sink After London Blasts
Published July 7 2005, 6:39 AM EDT
LONDON -- Stocks plummeted in Europe on Thursday after a series of rush-hour explosions in the city's subway system and aboard the city's famed double-decker buses.
The London Stock Exchange remained open after the explosions, but its key index, the FTSE 100, dropped 124.54 points to 5,105.10 by late morning. The German DAX fell 3 percent to 4,474.76, while in Paris, the CAC 40 dropped 2.75 percent. Exchanges elsewhere in Europe were also down.
Several blasts went off on the London subway and on three buses during the morning rush hour, police and news reports said, injuring some people and prompting officials to shut down the entire underground transport network. Some media reports said there were fatalities.
"Clearly, if this is a terrorist attack, that's going to cause great concern," said Lorenzo Codogno, co-head of European economics with the Bank of America in London.
He said traders were glued to TV screens watching details of the blasts, and gleaning whatever information they could get.
Commerzbank in London said it was advising staff to stay within the building, awaiting further advice from police.
As news of the blasts spread, the British pound dropped to $1.7410. Before the explosions were reported, the British pound had already dropped to a 14-month low of $1.7464, down from $1.7567, amid speculation the Bank of England may cut rates from 4.75 percent when it meets Thursday.
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