European Markets Yo-Yo

London, Frankfurt bourses swing wildly in early trading
By Jason Farago,  Newser Staff
Posted Jan 22, 2008 5:30 AM CST
Men walk past a logo outside the London Stock Exchange in London, Monday Jan. 21, 2008. European and Asian stock markets plunged Monday following declines on Wall Street last week amid investor pessimism...   (Associated Press)
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(Newser) – European markets went haywire in early trading Tuesday as investors reacted to a second straight day of Asian declines and awaited the reopening of Wall Street. After a disastrous showing for the Nikkei, Hang Seng and other Asian bourses, European markets plunged: the FTSE 100 dropped 200 points minutes after opening. Yet shares in London rallied amid rumors of emergency rate cuts by the three main central banks.

Talk of a coordinated emergency rate cut by the Fed, the ECB and the Bank of England drove London shares back up, and after 3 hours of trading the FTSE was up 0.6%. In Frankfurt, however, the DAX remained slightly down, having recovered somewhat from declines of 3%. All the European markets are waiting anxiously for the start of trading in New York, where markets were closed yesterday.