EMG drops 31 percent in London

European equities markets saw substantial declines on disappointing earnings reports and after the Bank of England and the European Central Bank both cut interest rates during the day.

The ECB cut Eurozone interest rates by half a percentage point to 3.25 percent on a unanimous vote and could make another cut next month, while the Bank of England’s Monetary Policy Committee cut UK rates by 1.5 percent, more than had been expected, to 3 percent.

The FTSE 100 was down 5.7 percent to 4,272.41 in London, while the FTSE 250 was 3.5 percent lower to 6,521.02.

The biggest loser on the 100 was hedge fund group Man Group (LSE: EMG), which dropped 31.1 percent after it reported that its profits fell by 24 percent, while retailer Marks & Spencer had the best day on the 100 with a gain of 3.27 percent.

Miners were much lower as Australia-based International Ferro (LSE: IFL) fell 38.46 percent for the worst day on the 250 while over on the 100 BHP Billiton (LSE: BLT; ASX: BHP; NYSE: BHP) was down 15 percent and Vedanta Resources (LSE: VED) dropped 20.54 percent as prices for metals declined.

The FTSE Eurofirst 300 was down 5.78 percent to 898.13 as the IBEX fell 6.27 percent to 9,133.9, the CAC-40 was 6.38 percent lower to 3,387.25 and the Dax dropped 6.84 percent to 4,813.57.

There were no winners on the CAC-40, where the biggest loser was steel maker Arcelor Mittal (Euronext: MT; NYSE: MT; BMAD: MTS; LuxSE: MT) fell 19.12 percent and carmakers were lower as Renault (Euronext: RNO) was down 13.62 percent and Peugeot (Euronext: UG) dropped 14.16 percent.

The steel sector lost the most on the Dax as well, as ThyssenKrupp (FWB: TKA; LSE: THK) was 12.87 percent, while chemicals group Altana (FWB: ALT; NYSE: AAA) led as it gained 37.91 percent on the session.

Equities markets in the Asia-Pacific region were lower on reduced outlooks from several sectors and by disappointing data from the US.

In Tokyo the Nikkei 225 was down 6.53 percent to 8,899.14 while the Topix index fell 5.96 percent to 909.3 and the Mothers market dropped 3.23 percent to 324.65.

Tokyo’s markets were hurt by yesterday’s reports from the United States, showing that more US jobs were lost and the US services sector contracted in October, with exporters especially affected by the prospect of declining demand from the US as well as by a strengthening yen.

The automobile manufacturing sector was hurt the most, on cuts in outlooks from Toyota (TYO: 7203; NYSE: TM; LSE: TYT) and Isuzu (TYO: 7202).

Toyota was down 10.59 percent while Isuzu dropped 20.69 percent on the session.

In the electronics sector, Sony (TYO: 6758; NYSE: SNE) dropped 11.05 percent while camera maker Canon (TYO: 7751; NYSE: CAJ) fell 12.59 percent.

Elsewhere in the region, the Shanghai Composite was down 2.44 percent to 1,717.72 while the Straits Times Index was 2.66 percent lower to 1,819.2 and the Sensex fell 3.81 percent to 9,734.22.

In Australia the Sydney Ordinaries dropped 4.22 percent to 4,106.5 and the S&P/ASX200 was down 4.31 percent to 4,149.7, with News Corp (ASX: NWS; NYSE: NWS, NWSA; LSE: NCRA) down 21 percent after it reversed its outlook and predicted losses rather than gains in profits.

Taiwan’s Taiex fell 5.71 percent to 4,694.12 while the Hang Seng was 7.08 percent lower to 13,790.04 in Hong Kong and South Korea’s Kospi dropped 7.56 percent to 1,092.22.

In Hong Kong, Cathay Pacific Airways (SEHK: 0293) was down 14 percent after it said its results will disappoint, while the steel sector saw declines all across the region after steel maker Arcelor Mittal (Euronext: MT; NYSE: MT; BMAD: MTS; LuxSE: MT), based in Luxembourg, issued a warning and announced production cuts.

Poor October sales data from US department stores were a factor in sending Wall Street lower in early afternoon trade as the Dow Jones Industrial Average was down 4.7 percent to 8,709.49 while the Nasdaq Composite fell 3.98 percent to 1,614.75 and the S&P 500 had dropped 4.85 percent to 906.53.

Same-store sales in department stores that have been open for one year were down 11.7 percent overall in October.

JCPenney (NYSE: JCP) was down 1.08 percent after reporting that October sales were down 13 percent while luxury retailer Saks (NYSE: SKS) fell 1.56 percent on sales that were down 16.6 percent last month and upscale department store Macy’s (NYSE: M) dropped 5.53 percent on same-store sales that fell 6.3 percent in October.

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