Global markets dive on US credit woes, weak dollar

AFP, March, 2008

LONDON (AFP) — Asian and European stock markets plunged on Thursday as investor sentiment was hammered by resurgent credit concerns, the plunging dollar and record high oil prices, dealers said.

Global financial markets were roiled after a troubled investment fund backed by US private equity giant Carlyle said it expected its creditors to seize its remaining assets after failing to strike a deal on its financing.

Analysts said that sparked fears that the worst of the global credit crunch was not over -- despite a huge cash injection for money markets that was announced by the US Federal Reserve and other central banks on Tuesday.

"Basically people don't believe the US Fed's actions help anyone at all apart from the banks," said Ric Klusman, head of institutional trading at Aequs Securities.

"We are giving back almost everything we gained yesterday," he added.

In Asia on Thursday, Tokyo closed down ...