`Domino Collapse` Crisis in the World Stock Market Due to the Terror Attack

Financial markets in the world are in chaos due to the terror attack on the heart of the world financial market. Stocks in Europe and Asia including Korea plunged in the aftermath of terror attack on the United States on the 11th. In the world currency market, the dollar value plummeted while gold and oil prices spiked up. The terror attack on America affected the stock market in the middle and South America. On the 11th, Brazil stocks tumbled and fell 9.18 percent, the largest loss in recent two years. Stock price index in Mexico and Argentina fell 5.55 percent and 5.17 percent.

The England FTSE index was off 5.72 percent, German DAX index was off 8.49 percent, French CAC40 Index was off 7.39 percent. England stocks tumbled with the largest loss since October 1987, when the world stock market plummeted altogether.

Asian investors who heard the news last night were busy selling stocks as soon as the stock market opens on the 12th. Tokyo stocks tumbled to 17-year lows as the key Nikkei stock average plummeted 6.63 percent, breaching 10,000 for the first time.

Hong Kong stock Index also breached 10,000 point and Singapore, Indonesia, Australia, New Zealand stocks also fell around 5 percent. Taiwan and Malaysia stock market closed on the 12th. Gold and oil price spiked up as investors rushed to the safe haven assets. Gold price was up 5 percent or 16 dollars, reaching 287 dollars. Oil prices, which had been up to 30 dollars per barrel, fell after OPEC gave reassurances over the security of world supplies.

The dollar, which tumbled in Europe market, also fell against major currency including yen on the 12th. At 4 p.m. on the 12th, the yen rose against dollars 118. 66 yen from 121.56 yen, the euro rose against dollars from 89,89 cents to 91.45 cents. Meanwhile, U.S markets including NYSE, ASE and NASDAQ markets have decided to close at least until 12th. Reopening day is uncertain yet. It is for the first time since the end of World War Two for NYSE to close two days in a low.

Keum Dong-Keun gold@donga.com