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S. Europe Shock Rattles Stocks for 2nd Day

Posted May. 08, 2010 07:35,   


The fiscal crisis in southern Europe rattled world financial markets for the second straight day Friday.

The European Central Bank’s failure to discuss buying Greek government bonds at its monetary policy meeting caused stocks to plummet in Korea as well as in the U.S. and Europe.

European Central Bank President Jean- Claude Trichet said his bank’s governing council did not discuss buying the Greek bonds, dashing market hopes of easing financial jitters.

Foreign net selling set a record high on the Korean stock market Friday as the benchmark index KOSPI fell for the second consecutive day. Foreign net selling reached a whopping 1.2 trillion won (one billion dollars), the highest since the government began compiling the statistic on Jan. 20, 1998. Affected by the heavy selling of foreign investors, the KOSPI fell 37.21 points (2.21 percent) to close at 1,647.50 for a cumulative fall of 4.15 percent Thursday to Friday.

The won-dollar rate jumped 14.1 points to 1,155.4 per dollar for a cumulative rise of around 40 points Thursday to Friday.

Elsewhere, Japan’s Nikkei fell 3.1 percent and China’s Shanghai Composite Index dropped 1.87 percent. The U.S. Dow Jones industrial average fell as much as 998.5 points (9.19 percent) but ended Thursday down 3.2 percent.