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Are we on the brink of a stock market crash

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Don Rizzle:
shanghai went down about 8 %, London went down 2.5 % I expect it will be similar again tomorrow with the Dow now down 4%. With talk of a US recession on the cards things doesn't seem as rosey as they were with the al time highs of the last couple of weeks................i'm hoping its just small correction, but my portfolio lost about 750 pounds today :(

Don Rizzle:
World shares wobble on China fear
Global stock markets have fallen after fears about China worried investors, with the UK's FTSE 100 posting its biggest drop in almost nine months.
The sell-off was sparked by a near-9% slide on the Shanghai Composite Index, as investors worried that China may pass rules to limit demand for stocks.

The FTSE 100 closed on a fall of 2.3%, or 148.6 points, to 6,286.1.

In the US, the Dow Jones opened 1% lower, while Germany's Dax index and France's Cac 40 each closed down 3%.

Earlier in the day, Hong Kong's Hang Seng index had ended trading on a loss of 1.8%, while Japan's Nikkei 225 index slid 0.5%.

"The US and global markets have gone for weeks without any sign of correction," said Fred Dickson, market strategist at DA Davidson.

"They seem ripe for a modest pullback."

Good growth

China has been one of the main emerging markets for many investors as the country's economy has grown strongly and the government has sold stakes in some of its biggest and most attractive companies.


 Foreign companies which are particularly exposed to China have been badly affected
Peter Dixon, Commerzbank
 

However, the government has been looking at ways of slowing growth in order to stop the economy from overheating, and many investors are worried that it may lead to tougher regulations that will limit stock-market investment.

At the same time, there are concerns that interest rates will have to be raised in order to rein in economic and price growth, further denting domestic demand for shares.

"Foreign companies which are particularly exposed to China have been badly affected," said Peter Dixon, an economist at Commerzbank.

"These companies basically will suffer in the event of things going sour in the Chinese market."

Standard Chartered, a lender that focuses on emerging markets, was one of the biggest UK decliners on Tuesday despite reporting earnings that topped analysts' forecasts.

Standard Chartered was down 4% at 1,450 pence.

Digging down


Also hurting UK shares was a newspaper report that South Africa may consider asking companies in the mining industry to pay an extra tax.

The news hit shares of mining firms, with Xstrata losing 6.7%, Vedanta Resources shedding 4.9%, Anglo American down 4.7%, BHP Billiton falling 6.2%, and Rio Tinto sliding 4.8%.

South African newspaper Business Day said the government may ask mining companies to pay an additional tax on top of the royalties they already pay when commodity prices climb above a certain level.

Commodity prices have climbed to record levels in recent months.

Analysts said they were uncertain about how far the FTSE would fall, but added that the index had performed well over the past six months.

Only one of the index's 100 members rose on Tuesday.

Story from BBC NEWS:
http://news.bbc.co.uk/go/pr/fr/-/1/hi/business/6400789.stm

Published: 2007/02/27 17:27:01 GMT

Don Seer:

i noticed some of this.. pound seems strong still....

i'm all for it right now (while i'm saving lol)...

Don Rizzle:
I don't have any worries about pound falling in value, compared to other currencies it will remain strong mainly due to our interest rates being relatively high, but that is not necessarily good for the economy because it makes our exports less attractive internationally and foreign imports more attractive domestically but it will be good for me while i am travelling because my pounds will go further.

saving money in the bank isn't that attactive to me because it doesn't bring any significant profit. for example in 2003 i put 7000 in a share ISA and in 2004 i put 3000 in cash ISA and in 2005 i put a further 7000 into my share ISA

today my cash ISA is worth about 3300 - 300 profit (although i did get 200 payout when the lambeth building society merged with portman and i'm set for another payout because portman is set to merge with nationwide building society, so i'm holding on to this one until september)

My share ISA today is worth 24600 - a 10600 profit (however yesterday it was worth arount 25100 :( )

Don Seer:
well thing is.. right now i'm saving.. so if my money makes more while saving or causes house prices to fall.. i'm all for it lol

i'm setting up an isa soon.. but also one of those high interest lock away and cant touch it jobbers.. right now i've got a high interest one that i can touch.. at the end of each year with the high interest i wanna squirt 3 k over to the isa

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