Nasdaq leads markets lower again
LONDON (AP) — Another drop in the tech-heavy Nasdaq index prompted renewed jitters across financial markets on Thursday despite earlier relief over Greece's successful bond market return.
Following a two-day recovery on Wall Street, stocks were being hammered again, particularly on the Nasdaq index, which was trading 1.8 percent lower. The concerns over the valuation of many companies remain as the U.S. quarterly corporate reporting season steps up a gear.
The sell-off came as somewhat of a surprise. Market sentiment had stabilized over the past couple of days following the Nasdaq-inspired retreat that started at the end of last week.
"There are warning signs that show a possible bearish tone creeping back into the markets despite the strength seen within the past two trading days," said Joshua Mahony, research analyst at Alpari.
In Europe, the FTSE 100 index of leading British shares closed up 0.1 percent at 6,641.97 but Germany's DAX fell 0.6 percent to 9,454.54. The CAC-40 in France was 0.7 percent lower at 4,413.49.
In the U.S., the Nasdaq's fall fueled declines elsewhere — the Dow Jones industrial average was down 0.3 percent at 16,381 while the broader S&P 500 index fell 0.7 percent to 1,860.a
Earlier, Greece had stolen the headlines after the country at the forefront of Europe's debt crisis over the past four years successfully tapped bond market investors for around 3 billion euros ($4.1 billion) of five-year debt at a yield below 5 percent.
To put that in context, the rate Greece has had to pay is around half that which Russia has to pay for the equivalent debt. And it comes even though the country has yet to emerge from a savage recession and remains lumbered by a debt burden of around 175 percent of gross domestic product.
"Overall, this debt sale is a triumph in financial terms," said Kathleen Brooks, research director at Forex.com.
Brooks credited the success to a number of factors, including the so-called "Merkel Guarantee," a reference to the pledge made by German Chancellor Angela Merkel during the financial crisis to keep Greece from exiting the euro bloc.
Risks remain for Greece, notably on the political front. But even there, analysts noted signs that the vast majority of people in the country want to stay within the 18-country eurozone.
"Considering everything Greece has been through one could argue that it is surprising that there hasn't been more of an anti-European stance taken by the people," said Gary Jenkins, an analyst at LNG Capital.
Reduced concerns over Greece and the future of the eurozone have also helped shore up the euro itself, which is trading near multi-year highs at $1.3890.
Earlier in Asia, markets in Hong Kong and Shanghai rose sharply on plans to link the bourses that would widen access to China for foreign investors. Hong Kong's Hang Seng gained 1.5 percent to close at 23,186.96 and the Shanghai Composite added 1.4 percent to end at 2,134.30.
Most other Asian benchmarks finished with modest gains. Tokyo's Nikkei 225 stock average ended unchanged at 14,300.12 while South Korea's Kospi rose 0.5 percent to 2,008.61. Australia's S&P/ASX 200 climbed 0.3 percent to 5,480.80.
