Jumat, 04 Mei 2012

Stock markets on both sides of Atlantic hit by worries over global economy

Stock markets on both sides of Atlantic hit by worries over global economy

By Hugo Duncan

PUBLISHED: 16:02 EST, 4 May 2012 | UPDATED: 16:02 EST, 4 May 2012

Pond life: Misery on both sides of the Atlantic

Stock markets on both sides of the Atlantic slammed into reverse yesterday amid mounting fears over the global economy.

Unemployment in the United States fell from 8.2 per cent to 8.1 per cent last month but only 115,000 jobs were  created â€" fewer than in March and below the 170,000 expected.

On this side of the Pond, the eurozone’s vast services sector suffered another month of decline as the recession in the single currency bloc deepened.

In Britain, house prices fell 2.4 per cent but sales of new cars rose 3.3 per cent as the UK economy remained stuck in the doldrums.

The FTSE 100 index fell 111.49 points to 5655.06 in London while shares in  Germany and France were down 2 per cent.

On Wall Street, the Dow Jones Industrial Average was off more than 150 points.

‘After a frankly horrendous week in the eurozone, the markets were looking to the US for some comfort. They didn’t get it,’ said Marcus Bullus, trading director at City trading firm MB Capital.

The slowdown in job creation in America raised fresh worries that the world’s biggest economy is losing momentum.

It will rattle nerves at the White House, where weak US growth and high unemployment are a threat to Barack Obama’s hopes of re-election.

Unemployment hit 10 per cent during Obama’s first year as president and hovered around 9 per cent for much of last year before falling sharply. But it is still well above the average of around 6pc over the last 50 years.

In the eurozone, the Markit index of activity in the services sector â€" where anything below 50 represents decline â€" fell from 49.2 in March to 46.9 in April.

‘Little can be said to remain of any core strength in the region,’ said Markit chief economist Chris  Williamson. ‘Growth has practically ground to a halt even in Germany, and France has joined Italy and Spain in see ing a strong rate of economic decline.’

Unemployment in the  single currency bloc is at a record 10.9 per cent and a quarter of workers are jobless in Spain.

UK mortgage lender  Halifax said the average price of a house in Britain fell 2.4 per cent in April to £159,883 â€" more than reversing the 2.2 per cent rise in March.

‘House prices continue to lack real direction with the current UK average price little different to where it was at the end of 2011,’ said Martin Ellis, housing economist at Halifax.

But the Society of Motor Manufacturers and Traders said car sales rose 3.3 per cent to 142,322 last month as drivers bought new models.


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Damn them. As always happens, the markets surged a bit just before all the pension funds made their monthly unit purchases only to fall back again. Low stock markets are excellent for pension accrual, but the system seems rigged to prevent the units being purchased at the best price.

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Jobs cannot come back from China to the UK until the huge tax burden has been lifted, everything will seize up, benefits will dry up, no more paying for mansions in London.

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America raised fresh worries that the world’s biggest economy is losing momentum. IT ALREADY HAS!.LOST.

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