Global shares wilt amidst surging oil prices, ECB rate hike
03 Jul 2008
Mumbai: Global stocks hit a five-month low on Thursday knocked down by surging oil prices and and a hike in interest rate by the European Central Bank, amidst concerns of inflation and slowing growth.
Tokyo stocks registered their longest losing streak in more than 50 years as investors remained anxious about skyrocketing crude oil prices and an expected interest rate hike by the ECB.
The 225-stock Nikkei average ended Thursday morning session down 9.19 points at 13,277.18, continuing its Wednesday's fall of 176.83 points.
The TOPIX index of all first-section shares was off 5.22 points at 1,295.93 after falling 18.92 points the previous day.
The US Dow Jones industrial average ended below 11,300 for the first time in 23 months on Wednesday due to worries of the financial health of auto giant General Motors Corporation.
The FTSEurofirst 300 index was down 1.5 per cent, hitting its lowest level since July 2005. MSCI main world equity index fell 0.7 per cent to its lowest since 23 January.
The European Central Bank announced a 25 basis point hike in interest rate to 4.25 per cent, becoming the first G7 central bank to raise interest rates since the credit crisis erupted in August.
The euro benefited from the expected rate hike while the dollar fell as low as $1.5891 per euro.
A weaker dollar helped in part to push already high oil prices to a record above $145 a barrel. Gold also rose to $944.55 an ounce, its highest in almost 2-1/2 months.