Global stocks slide for 2nd day after oil decline

France’s CAC-40 fell 1.7% while Germany’s DAX dropped 1.2%

london — Global stock markets fell sharply on Thursday as oil prices slid and a US Federal Reserve official argued for a possible interest rate hike that saw the dollar gain ground.

On the last day before the long Easter weekend break, stock markets in Europe were posting big losses. France’s CAC-40 fell 1.7 per cent to 4,350 points while Germany’s DAX dropped 1.2 per cent to 9,906. Britain’s FTSE 100 was 1.3 per cent lower at 6,119. Wall Street looked set for further losses — Dow futures and the broader S&P 500 futures were down 0.5 per cent. US stock markets are also closed on Good Friday, so Thursday’s session could well be impacted by traders closing out positions ahead of the break.

Wednesday’s session in the US was impacted by comments from a top official at the US Federal Reserve and that followed through into Thursday trading in Europe and Asia. James Bullard, president of the St. Louis Federal Reserve Bank, pointed to a broadly unchanged economic outlook and said a case could be made for a possible rate hike next month if the next round of jobs data exceeds official targets.

The dollar advanced in the wake of Bullard’s comments, a development that weighed on Wall Street as investors fretted over the impact on US exports.

“Markets have taken a turn lower, taking their cue from a difficult session last night in the US and a mixed session in Asia,” said Chris Beauchamp, senior market analyst at IG. “The culprits are not difficult to find — a rising US dollar and weaker oil prices.”

The Shanghai Composite Index tumbled 1.6 per cent to 2,960.97 and Hong Kong’s Hang Seng retreated 1.3 per cent to 20,345.61. Sydney’s S&P ASX 200 fell 1.1 per cent to 5,085.60 and Seoul’s Kospi was off 0.5 per cent at 1,985.97. Tokyo’s Nikkei 225 shed 0.6 per cent to 16,892.33.