Global stocks tank on economic slowdown

US stock-index futures tumbled on concern the global economic slowdown is worsening, pointing to the biggest decline in the Standard & Poor's 500 Index since September 2001.

S&P 500 Index futures expiring in March retreated 63.9, or 4.8 per cent, to 1,261.4 as of 7:48 a.m. in New York. The MSCI World Index fell 1 per cent, bringing its two-day drop to 4 per cent.

European stocks pared losses, with the Dow Jones Stoxx 600 Index slipping 0.6 per cent after sinking as much as 4.1 per cent, on speculation the worldwide equity slump may spark coordinated interest-rate reductions by central banks.

"All of the economic data coming out of the US points to a severe weakening," said Chirin Gill, who helps manage the equivalent of $3 billion at Daiwa SB Investments in London. The US market was closed for Martin Luther King Day yesterday.

Bear market spreads to Asia, Europe
Asian stocks plunged for a second day, sending the region's benchmark to its biggest decline since April 1990, on concern the global economy is slowing.

The MSCI Asia Pacific Index tumbled 6.5 per cent to 132.06 at 7:29 p.m. in Tokyo, following Europe into a bear market and extending a global slump that has wiped more than $5 trillion from stock markets this year.

Japan's Nikkei 225 Stock Average sank 5.7 per cent to 12,573.05. Australia's All Ordinaries Index fell 7.3 per cent, the most since October 1989. India's Sensitive Index fell 5 per cent, paring an earlier loss of as much as 13 per cent.

India's Finance Minister P Chidambaram urged investors to "stay calm" after the Sensex plunged the most in almost 16 years, triggering a one-hour trading halt. It has now slumped almost 20 per cent from its closing peak on January 8.

European stocks fell as investors speculated the global economic slowdown is worsening.

The Dow Jones Stoxx 600 Index lost 0.9 per cent to 306.43 as of 12:20 p.m. in London, dropping for the sixth day. Stocks fell yesterday, sending the index down more than 20 per cent from a 6 1/2-year high on June 1 on mounting concerns the US will enter a recession.

The Stoxx 50 slipped 0.9 per cent, while the Euro Stoxx 50, a measure for the euro region, sank 1.3 per cent.