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Shares pummelled, dollar slumps

Thursday, Jun 13, 2013 - 01:06

June 13 - World stocks fell and the dollar slumped on Thursday as a sell-off on global financial markets in thrall to central bank stimulus accelerated. Sonia Legg reports.

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The sell-off started in Asia and continued in Europe. European shares dropped 1.3% and Germany's DAX dropped below the key 8,000 mark. That was after Japan's Nikkei suffered its second biggest fall in two years. Traders in Frankfurt blamed noises about the U.S. Federal Reserve scaling back its huge asset purchasing programme. The Fed meets next week. (SOUNDBITE) (German) ROBERT HALVER FROM BAADER BANK, SAYING: "Japan is the one which suffers the most from the bad words of Ben Bernanke because the Japanese index has been pushed up more than anything else by the flood of international liquidity." Heavy selling hit the dollar which slumped 2 percent against the yen and dropped to a 3-1/2 month low against the euro. More fluctuations are expected but Baader Bank's Robert Halver doubts the liquidity will end. (SOUNDBITE) (German) ROBERT HALVER FROM BAADER BANK, SAYING: "I don't think the central banks will be able to get out, they just can't. The money drug is the decisive drug and it needs to be injected into the patients' veins while the economy isn't working." In the debt markets German government bonds rose as investors sought safe havens.

Shares pummelled, dollar slumps

Thursday, Jun 13, 2013 - 01:06

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