US stock markets regain ground after sharp fall
Feb 6, Washington DC: US stock markets today sank sharply at the opening bell, amid frantic Wall Street trading.
The main US indexes opened about 2% down, but then pared losses, with the benchmark Dow Jones turning positive in just a couple of minutes. Investors are worried about prospect of rising interest rates that push up the borrowing costs for consumers and businesses.
Earlier on Tuesday, markets in London, Frankfurt and Paris had initial losses of up to 3%, before recovering some ground. Japan's Nikkei 225 closed down 4.7%.The sell-off began last week after data in the US showed stronger wage growth, which raised expectations that US interest rates might start to rise more quickly to tackle inflation.
London's FTSE 100 was down 150 points or 2% at 7,184.74 in mid morning trade. Frankfurt's Dax and Paris's CAC were down 2.2% and 2% respectively.On Monday the FTSE 100 closed at its lowest level since April of last year.
Rising interest rates increase borrowing costs for companies and consumers. Also, many analysts have been forecasting for months that the financial markets were due a correction after a long period of rising prices.
The Oslo Times International News Network