World Markets Down Big Time After Fed Annoncement
Stock markets around the world tumbled on fears that U.S. and European policymakers may have run out of measures to stop the global economy from entering recession.
The Dow Jones industrial average closed Thursday down 391.01 points, or 3.5%, to 10,733.83. The broader Standard & Poor’s 500 index was down 37.18 points, or 3.2%, to 1,129.58.
The Dow had earlier been down over 500 points, but recovered some of those losses in the final half hour of trading.
The U.S. declines followed sharp drops overnight in Asian and European markets, many of which fell about 5%. Coming after losses earlier in the week, stock markets around the world are now at risk of the biggest weekly decline since the depths of the global financial crisis in 2008.
The worldwide sell-off followed the Federal Reserve’s announcement Wednesday that it is rejiggering its holdings of Treasury bonds in its latest bid to spur the economy by lowering interest rates on everything from home mortgages to car loans.
Many analysts, however, doubt the Fed action will have any measurable effect, and investors were spooked by the Fed’s bluntly worded warning of “significant downside risks to the economic outlook.”
Source: LA Times
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