Fears over banks and economy spark volatility 11Q1AN
1m4$ p2j
Financial markets saw further volatility yesterday as worries about the fragility of the banking sector and deepening gloom about the global economic outlook remained uppermost in investors' minds. rB
Q _iB_
j'Fpjt"&=
“Sentiment is increasingly showing facets of the November gloom as temporary gains are quickly erased,” said Ashraf Laidi, at CMC Markets. "q3ZWNS'w
8V'~UzK
“We had repeatedly warned late last year that rising risk aversion would return in the first quarter as the economic story joins the earnings story on the downside.” |3('
N#|
t%d Z-Ym
A strong opening rally on Wall Street stuttered, derailing a tentative recovery by European stocks and helping Treasury bonds pare early losses. The yen shot higher across the board as nervous investors sought the safety of the Japanese currency. (nQ
^
ER%^!xA
Conversely, sterling continued to suffer on the currency markets as the fallout from the bail-out package for UK banks announced at the start of the week continued to reverberate around the markets. hNC&T`.-~B
Z@4Arfl
The pound fell to a 23-year low against the dollar. It also touched a fresh record low against the yen and lost ground against the euro.