The prospect of war is slowly taking its toll on the global economy and stock prices have dropped ag...
The prospect of war is slowly taking its toll on the global economy and stock prices have dropped again this morning on the back of a huge fall in the price of crude oil.
The FTSE 100 fell 54.2 points or 1.2% to 4558.2 at the open after crude oil posted its biggest drop since the Persian Gulf War in 1991.
Shell, which owns 40% of Royal Dutch Group, dropped 16.75p or 3.7% to 448p, while BP declined 10.5p or 2.1% to 502p, wiping 18 points off the FTSE 100.
Crude oil traded below $23 a barrel overnight after plunging 15% in New York trading, on the expectation that the US terrorist attacks will trigger a global recession and cut fuel demand.
Investors in the US now believe last week's huge losses were exaggerated against the global economy, and many analysts now see a market rebound within six to nine months.
The Dow Jones Industrial Average rose 368.05 points or 4.5% to 8603.86 while the Nasdaq Composite index jumped 76.21 or 5.4% to 1499.4 points. Some of the largest US companies, including General Electric, Citigroup, Intel and JDS Uniphase pushed the indices higher and the Nasdaq saw its biggest gain since April 18.
Japanese investors took the US gains as a good sign and attempted to turn around last week's slump as analysts try to predict a short to medium-term bull market. Some people even believe the terrorist attacks have given everyone a chance to stave off the US recession with the huge injections of capital from central banks that the markets have seen.
The Nikkei 225 index gained 138.98 points or 1.5% to 9693.97, having fallen to its lowest level on Friday since 1983.
Sony depends on the US market for one third of its operating profit, so it gained 4% to 4390, and Toyota regained some ground closing at 2970.
Two global vehicles
'Further plug advice gap'
Must appoint separate CEOs and boards
Advisers do come out well
Will report to Mark Till