News Column

European Stocks Fall as Concern Over World Economy

June 13, 2013

European stocks fell on Thursday, mirroring losses in Asian markets, amid concerns that the US Federal Reserve would wind down stimulus measures.

The Euro Stoxx 50, Europe's leading Blue-chip index for the Eurozone, fell by more than 1 per cent in London. The DAX, FTSE, and CAC 40 also registered losses of 0.7 to more than 1.5 per cent.

The falls came after Asian stock markets suffered huge losses as foreign investors fled to safe havens over concerns that the United States was scaling down stimulus measures.

Market sentiments were also dampened after the World Bank cut growth forecast for the global economy to 2.2 per cent this year, from its January estimate of 2.4 per cent.

It cited deeper-than-expected recession in Europe and a slowdown in China and India for the downgrade.

"The trigger for the sharp fall is Japan where the Nikkei fell by 6.35 per cent this morning," said Ludwig Donnert of Tao Capital in Frankfurt.

Traders in Asia said fund managers were exiting Asian markets amid fears that the US Federal Reserve would scale back a massive bond-buying programme following signs of an improving economy.

The Federal Reserve has been spending 85 billion dollars a month to buy bonds to push down interest rates in a bid to prop up the US economy by triggering borrowing and spending.

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Source: Copyright 2013 dpa Deutsche Presse-Agentur GmbH

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