6 Dec 2008

Shares in Europe slide on US job cuts

11:00 am on 6 December 2008

European stocks have fallen due to dire unemployment data in the United States.

The pan-European FTSEurofirst 300 index closed down 4% at 793.94 points.

A credit crisis has sliced about half the value off the European stock market so far this year as major economies around the globe grapple with recession.

US employers axed payrolls by 533,000 in November for the weakest performance in 34 years.

Wall Street indexes were 2% to 3% lower when the European market closed for the day.

In Frankfurt, the DAX index ended at 4381.47 points, down 182.76 or 4%.

In Paris, the CAC-40 index closed at 2988.01 points, down 173.15 or 5.48%. The Swiss market closed at 5530.84 points, down 118.3 or 2.09%.

In Britain, the FTSE 100 closed 114.24 points lower, 2.7%, at 4,049.37. The index is down 37.3% to date this year.

On Thursday, the European Central Bank lowered interest rates by 75 basis points to 2.5%, while the Bank of England cut rates by 100 basis points to 2%.

Other markets

In Japan, the Nikkei was down 0.1%. The index has lost some 48% to date this year.

However, shares rose 2.5% in Hong Kong on speculation that Beijing may further ease interest rates and cut reserve requirements on bank deposits.

The Hang Seng Index closed up 336.31 points at 13,846.09.

In Australia, the S&P/ASX 200 index lost 42.5 points to close at 3,489.9, The index lost 6.8%, or 252.6 points, over the week.

The All Ordinaries reversed 40.9 points, or 1.18%, to 3,427.2.

National turnover was 1.2 billion shares worth $A3.74 billion.

In New Zealand, the NZX50 was 23 points lower, or 0.88%, to 2706.

Top stocks were all lower: Telecom shed 7 cents to $2.32, Contact Energy slid 14c to $6.85, while Fletcher Building was down 1c to $5.62.