G-khan
03-24-2003, 12:41 PM
Reports of intensified fighting in Iraq have sent stock markets sharply lower and oil prices higher.
"The war is not a cakewalk and this will sober up some of the traders betting on a quick recovery," said Alan Ackerman at Fahnestock & Co.
"The fighting on the ground could be very nasty and could be unpredictable and could take longer than many expected."
At 1605 GMT, the Dow Jones index of leading US shares was down 259 points, or 2.9%, at 8,262.
The FTSE 100 index of leading UK shares was down 115 points, or 2.8%, at 3,745.
The oil market has been behaving as if peace has broken out
Adam Sieminski, Deutsche Bank
Both France's Cac 40 share index and the Frankfurt Dax were down 5.3% by the same time.
The falls followed substantial rises last week when investors reacted positively to the ending of uncertainty over war and early signs that the conflict might prove short-lived.
Nigerian shutdown
Oil prices rose $1.40 to $25.70 a barrel by late afternoon trading in London.
"The oil market has been behaving as if peace has broken out but the level of Iraqi resistance so far suggests the war could drag on, with consequences for oil prices," said Adam Sieminski, an oil analyst at Deutsche Bank.
MARKET MOVES EXPLAINED
Traders are hoping for a short, sharp war
Oil traders were also reacting to news that more than 30% of Nigeria's output has been shut down because of ethnic warfare.
"My guess is that Brent [the London benchmark crude oil] will hold at this level until we get a clearer picture of where the [Iraq] war is going to go," said Barclays Capital analyst Orrin Middleton.
"I still think that when Saddam [Hussein] is out of the way, we will see new lows, around $22 for Brent."
While in most markets last week's bullish mood had evaporated, traders in Tokyo rushed to buy shares after Friday's public holiday.
The blue-chip Nikkei index closed 240 points or 2.9% higher at 8,435.
http://news.bbc.co.uk/1/hi/business/2879789.stm
"The war is not a cakewalk and this will sober up some of the traders betting on a quick recovery," said Alan Ackerman at Fahnestock & Co.
"The fighting on the ground could be very nasty and could be unpredictable and could take longer than many expected."
At 1605 GMT, the Dow Jones index of leading US shares was down 259 points, or 2.9%, at 8,262.
The FTSE 100 index of leading UK shares was down 115 points, or 2.8%, at 3,745.
The oil market has been behaving as if peace has broken out
Adam Sieminski, Deutsche Bank
Both France's Cac 40 share index and the Frankfurt Dax were down 5.3% by the same time.
The falls followed substantial rises last week when investors reacted positively to the ending of uncertainty over war and early signs that the conflict might prove short-lived.
Nigerian shutdown
Oil prices rose $1.40 to $25.70 a barrel by late afternoon trading in London.
"The oil market has been behaving as if peace has broken out but the level of Iraqi resistance so far suggests the war could drag on, with consequences for oil prices," said Adam Sieminski, an oil analyst at Deutsche Bank.
MARKET MOVES EXPLAINED
Traders are hoping for a short, sharp war
Oil traders were also reacting to news that more than 30% of Nigeria's output has been shut down because of ethnic warfare.
"My guess is that Brent [the London benchmark crude oil] will hold at this level until we get a clearer picture of where the [Iraq] war is going to go," said Barclays Capital analyst Orrin Middleton.
"I still think that when Saddam [Hussein] is out of the way, we will see new lows, around $22 for Brent."
While in most markets last week's bullish mood had evaporated, traders in Tokyo rushed to buy shares after Friday's public holiday.
The blue-chip Nikkei index closed 240 points or 2.9% higher at 8,435.
http://news.bbc.co.uk/1/hi/business/2879789.stm