Скачать или смотреть UK: LONDON: SHARES ON STOCK MARKET SUFFER SHARP DROP

(14 Jan 1999) English/Nat

Shares on the London stock market suffered a sharp drop in value on Thursday, before bouncing back into the black.

Shellshocked analysts and traders have been left bewildered, unsure as to which way shares will go next.

The wild swings followed Wednesday's record falls caused by Brazil's banking crisis and currency devaluation, as well as fears of a global financial meltdown.

Within the first hour of trading on Thursday the London market veered between a fall of 51 points and a rise of 53 points.

Traders had braced themselves for further turmoil following the FTSE-100 Index of leading shares closing down 183.5 points, at 5850.1 on Wednesday.

There were fears that worldwide markets would be thrown into turmoil when Brazil's central bank president Gustavo Franco resigned, and the Brazilian government announced it was devaluing its currency by 8 per cent.

The Dow Jones industrial average was down overnight, while reaction from Asian markets has been mixed.

Despite initial feelings of panic, global markets do appear to be calmer on Thursday.

New York stock prices are also expected to bounce back later on Thursday, despite Brazil's economic woes.

But some fear the worst could be yet to come.

SOUNDBITE: (English)
"Well I'm afraid we are in this sort of bungey jumping market at the moment it just takes an element of nerves too, because of something like this, and you will see a two or three per cent drop off. What is interesting is how quickly they keep on picking up again. There will be more of these, around our markets we have got various mines bobbing around. Anyone of them can go off at anytime. Brazil went off yesterday, we've still got Russia, we've still got China, and of course other Japanese issues can come up easily as well. Anyone of those could cause other significant issues, but I think we have to wait until later in the year when hopefully the Japanese have taken significant action and start seeing the real growth in their economy and that will see then a part of a sustained growth around the world."
SUPER CAPTION: Justin Urquart Stewart, Corporate Development Director, Barclays Stock Brokers

For the time being though, the short-term global effects of Brazil's economic crisis appear minimal.

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