European share prices tunnelled to new depths yesterday on foot of the sharp rise in US unemployment. The Irish Stock Exchange fell to its lowest close in more than four months at 5,678.79, down 106.69, with banks taking most of the hammering.
Europe's three main markets in London, Paris and Frankfurt all hit lows not seen for more than two years, as investors interpreted the US data as a sign that the global economic slowdown could get worse before it gets better.
London's FTSE 100 index fell to a new three-year-low point of 5,068.6 points at one stage and closed at 5,070.3 points, down 134 on the day.
In Frankfurt, the DAX sank to a new two-and-a-half-year low, closing at 4,730.67 points, down 2.97 per cent. The Paris CAC 40 index meanwhile slid another 1.5 per cent to 4,413.51 points, having briefly slid below the 4,400 mark.
Across the 12-nation euro zone, the Euro Stoxx 50 index gave up 1.43 per cent to 3,499.51 points, while the euro bought $0.9044.
"This market is weak, hedge funds are selling it short and no one is buying at the moment," said London-based stockbroker Mr Justin Urquhart Stewart. "When you get good news out, people say 'I don't believe it' and when you get bad news they say 'I told you so'. You can't see down to the bottom and you can't see across to the recovery," he said.
European share markets are mostly more than 30 per cent below last year's peak. Some distressed telecoms and high-tech groups have fallen more than 90 percent from their peaks, making a turnaround point hard to predict."
