June 29, 2002 | 1510 IST
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Money > Business Headlines > Report June 29, 2002 | 1510 IST |
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WorldCom adds to global bourses' woesB G Shirsat The nine months after the September 11 terrorist attacks in the US, the world stock markets have plummeted once again in the last one month. The fall in the major stock indices varied between 6 per cent and 18 per cent. Meanwhile, the Bombay Stock Exchange Sensex declined by 1.8 per cent in the last one month, and the Karachi Stock Exchange index appreciated 6.8 per cent. The Nasdaq-100 is down 14.2 per cent, the CAC-40 index 13.6 per cent, Nikkei-225 12.3 per cent and the Dow Jones 9.6 per cent lower than its levels a month ago (on May 24, 2002). The FTSE fell to a nine-month low of 4442.90, down 13 per cent in a month. Stocks are headed down again. Two of the most widely followed indices - Dow and Nasdaq - are almost back to the panic lows of the post-September 11 period. The Nasdaq, dragged down by technology stocks, finished at 1423.99 on June 25, only 0.80 points above its post-attacks low of 1423.19 on September 21, 2001. On June 26, the Nasdaq plummeted to four years low of 1379.87. There after it recovered to 1455.77. The Standard & Poor's 500-stock index closed on June 25 at 976.14, just 3.32 per cent above its September 21 close of 944.75. It dipped a low of 952.92 on June 26 and recovered to 990.64 on June 27. The Dow Jones Industrial average though, above its September 21 lows of 8235.80 is hanging close to its eight-month low at 9126.82. On June 26, Dow had fallen to 8831.92. There after it recovered by 400 points to close at 9247.21 on June 27. In Tokyo, the benchmark Nikkei-225 fell to a four-month low to close at 10496.67, down 12.3 per cent in a month. The Korea Composite stock price index has fallen by 17 per cent in a month to close at 742.72 on Friday. Hang Seng, the Hong Kong index, has lost around eight per cent in the last one month, to close at 10,598.55. The dollar weakened against all international currencies in the last two weeks. The Indian rupee appreciated by 0.2 per cent in two weeks, while it has depreciated 2.88 per cent over euro and yen, 3.39 per cent over Swiss Franc and 2.01 per cent over the pound. The real problem today is the pervasive worry about something much more fundamental to the stock markets - corporate profits. The big question lingering world-wide has been the doubts about businesses' ability to generate profits. A big part of the crisis, is lack of confidence in the integrity of the profit numbers themselves. WorldCom's startling disclosure of an accounting hole of nearly $3.8 billion in its balance sheet reverberated across the world markets on Wednesday, knocking off stock indices across Asia and Europe, and pulling the rug from under the dollar. The shocks added to the general discomfort in the world's equity markets, ever since the Andersen controversy broke out. The market recovered thereafter in a small bout. Powered by ALSO READ:
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