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Dollar Nosedives, Global Markets Tumble

Posted Mar 17, 08 3:55 AM CDT in Business 

(Newser) – The dollar took a pummeling and equity markets in Europe and Asia slumped as worried investors reacted to the Bear Stearns fire sale and the Fed's emergency rate cut. The dollar dropped to a shocking 95 yen, hit an all-time low of $1.59 against the euro, and remained below one Swiss franc. The US currency is "facing a credibility crisis," one Asian investor told Bloomberg, while another said that "the Fed is throwing the dollar out of the window."

After a bad day in Asia—the Hang Seng plunged 5.2% and the Nikkei 3.7%, leading declines across the continent—it was Europe's turn to reel. By late morning the DAX in Frankfurt was down 3.1%, with the FTSE and the CAC 40 following close behind. Investors were unimpressed by the Fed's facilitation of JPMorgan's $2-a-share buyout of Bear Stearns, which only stoked fears that more companies are in trouble.

Sources Bloomberg, Financial Times (UK)

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A currency dealer works under an electronic board showing the current U.S. dollar rate as the U.S. dollar fell to 95-yen level in early trading in Tokyo, Japan, Monday, March 17, 2008.   (AP Photo/Toru Takahashi)
Pedestrians are reflected on the digital stock indicator in Tokyo Monday, March 17, 2008. Japan's benchmark Nikkei stock index plunged 4.2 percent in the morning session Monday as the dollar hit a 12...   (AP Photo/Koji Sasahara)
TV crew interview a man in front of the digital stock indicator in Tokyo Monday, March 17, 2008. Japan's benchmark Nikkei stock index plunged 4.2 percent in the morning session Monday as the dollar hit...   (AP Photo/Koji Sasahara)
A floor trader reacts as he watches the stock prices at Hong Kong Stock Exchange in Hong Kong Monday, March 17, 2008. Hong Kong's benchmark index fell as much as 5.4 percent in early trade Monday.   (AP Photo/Kin Cheung)
A floor trader reacts as he watches the stock prices at Hong Kong Stock Exchange in Hong Kong Monday, March 17, 2008. Hong Kong's benchmark index fell as much as 5.4 percent in early trade Monday as investors...   (AP Photo/Kin Cheung)
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Tags

Bear Stearns  • US dollar  • JPMorgan Chase  • euro  • Asian markets  • Nikkei  • yen  • Hang Seng  • Swiss franc


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