KAZ leads 100 lower in London

European equities markets declined sharply Monday as the euro weakened, oil and metals prices fell, and bank bailouts spread to Europe from the US.

German chancellor Angela Merkel said that her government will guarantee private accounts to prevent a run on banks, while Denmark also announced that deposits will be insured against losses and the Chancellor of the Exchequer in the UK said the government there will do “whatever it takes” to keep banks solvent.

In London the FTSE 100 dropped 7.85 percent to 4,589.19 while the FTSE 250 dropped 6.51 percent to 7,474.79.

While banks were lower, copper miner Kazakhmys (LSE: KAZ) with a decline of 26.58 percent while Xstrata (LSE: XTA) was down 19.11 percent and Antofagasta dropped 17.49 percent.

There were no winners on the 100.

There were also no winners on the CAC-40 in Paris, which dropped 9.04 percent to 3,711.98 while the Dax was down 7.07 percent to 5,387.01 in Frankfurt and the IBEX was 6.06 percent to 10,726 in Madrid and the pan-European FTSE Eurofirst 300 fell 7.39 percent to 1,008.86.

European banks plummeted, led by bailed-out German commercial property lender Hypo Real Estate (FWB: HRX) with a decline of 37 percent and Dexia (Euronext: DX; LuxSE: DXB) led losers on the CAC-40 with a decline of 20.29 percent.

The widening credit crisis also hurt equities markets in the Asia-Pacific region.

In Tokyo, the Nikkei 225 was down 4.25 percent to 10,473.09 while the Topix index fell 4.67 percent to 999.05 and the Mothers market of small and mid-caps dropped 9.86 percent to 320.59.

It was the first time the Topix fell below the 1,000 level in almost five years.

Financial shares were lower, with Mizuho Financial (TYO: 8411; NYSE: MFG) down 7.8 percent while Mitsubishi UFJ (TYO: 8306; NYSE: MTU) was 9.2 percent lower and Resona Holdings (TYO: 8308) dropped 9.5 percent, while in the steel sector JFE Holdings (TYO: 5411) fell 7.2 percent, Nippon Steel (TYO: 5401) was down 7.8 percent and Sanyo Special Steel (TYO: 5481) dropped 15 percent.

In the electronics sector, Sony (TYO: 6758; NYSE: SNE) was 6.6 percent lower and game-maker Nintendo (TYO: 7974; NAS: NTDOY; FWB: NTO) fell 8 percent, while construction machinery manufacturers, miners, and real estate developers also saw declines.

In Australia, the S&P/ASX200 was down 3.3 percent to 4,540.4 and the Sydney Ordinaries fell 3.36 percent to 4,544.7 while the Taiex was 4.12 percent lower to 5.505.7, the Kospi dropped 4.29 percent to 1,358.75, the Hang Seng fell 4.97 percent to 16,803.76, the Shanghai Composite was down 5.23 percent to 2,173.74, the Straits Times Index was 5.61 percent lower to 2,168.32 and the Sensex dropped 5.78 percent to 11,801.7.

At around 1 p.m. in New York the Dow Jones Industrial Average was down 5.07 percent to 9,802.02 while the Nasdaq Composite had fallen 6.06 percent to 1,829.34 and the S&P 500 had dropped 5.65 percent to 1,037.1.

The US Federal Reserve said it will increase its emergency loan program to banks to $900 billion by year’s end; it also said it will begin paying interest on bank reserves in order to try to persuade banks to deposit more than the minimum required by the Fed.

Meanwhile, the US treasury said it will adjust its auction calendar and is thinking about reintroducing three-year notes in November.
Walt Disney (NYSE: DIS) was 6.92 percent lower at 1 p.m. in New York as media companies declined on the likelihood that they will be hurt by declines in consumer spending as the economy weakens.

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