World markets plunge on US auto bailout failure
World stock markets plunged Friday as the U.S. Senate’s rejection of a $14 billion deal to rescue Detroit’s automakers and further grim economic data stoked concerns that the recession in the world’s largest economy will be longer and deeper than expected.
The FTSE 100 of leading British shares was down 169.74 points, or 3.9 percent, at 4,218.95, while Germany’s DAX fell 230.35 points, or 4.8 percent, to 4,536.85. The CAC-40 in France fell 181.02 points, or 5.5 percent, to 3,125.11.
Earlier, Asian markets tumbled, with Japan’s Nikkei 225 stock average down 484.68 points, or 5.6 percent, to 8,235.87. Hong Kong’s Hang Seng index slid 5.5 percent to 14,758.39.
U.S. stock index futures pointed to a big sell-off later on Wall Street. The Dow Jones industrial average was projected to drop 278 points, or 3.2 percent, to 8,292, while the broader Standard & Poor’s 500 index was forecast to fall 33.80 points, or 3.9 percent, to 840.70.
Investors were rattled after the bailout for Detroit’s struggling Big Three automakers failed in the U.S. Senate. The collapse came after bipartisan talks on the auto rescue broke down over Republican demands that the United Auto Workers union agree to steep wage cuts by 2009 to bring their pay into line with U.S. plants of Japanese carmakers.
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