Media Grok: European tech markets plunge

Investors always eye the markets nervously, but over the Christmas break those eyes were a bit blearier and much more nervous.

          Investors always eye the markets nervously, but over the Christmas break those eyes were a bit blearier and much more nervous. The global economy took a severe hit as last week ended and today most European papers lay the blame at the feet of US Federal Reserve Chairman Alan Greenspan. Not for anything he did, mind you, but for what he did not do on Tuesday: lower interest rates.

          It's not as if the European markets were faring all that well anyway on Wednesday, but as CNNfn reports: "Once Wall Street opened with a sharply negative tone, the selling redoubled in Europe." And as usual these days, that negative tone was only amplified by the European Nasdaq-wannabes – Germany's Neuer Markt, France's Nouveau Marchi, Spain's Nuevo Mercado... you get the idea.

          The plunge on the Neuer Markt came close to matching the shock value of Nuevo Mercado's 10 per cent stumble, but then the Neuer Markt has been at it longer. The Financial Times notes that the Frankfurt exchange has fallen by more than 60 per cent since its peak in March, a losing streak that is at least partly responsible for a new round of "disclosure of directors dealing" rules introduced by the Deutsche Bvrse yesterday.

          The goal is more transparency in order to halt the sort of outright insider trading and the general buying and selling frenzies that lead to over-evaluations, and ultimately, dramatic downfalls or even bankruptcies. The Neue Z|rcher Zeitung reports that similar, though not quite as stringent rules will also be introduced to regulate the Swiss New Market.

          But rules don't govern the sort of emotional factors contributing to what the Handelsblatt calls "a black day on the Neuer Markt" or what the Financial Times Deutschland refers to as the "funereal atmosphere after the great sell-off". Both papers run packages dissecting the disaster and both find far deeper causes for it than the whims of Alan Greenspan.

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