from London’s Telegraph
Russia and Brazil crumble as commodity prices crash
The entire complex of commodities and emerging market stocks, bonds, and currencies is now in free-fall as the economic crisis spreads like brushfire, threatening to draw every corner of the globe into the vortex of recession.
Gold surged $34 to $864/oz on safe-haven buying as the markets came face to face with the unsettling reality that the euro is no healthier than the dollar, and perhaps sicker.
The sudden shift in commodity sentiment has led to a massive withdrawal of funds from frontier markets, triggering stock market routs across Latin America, Asia, and Eastern Europe. The MSCI index of emerging markets fell 11pc yesterday in its worst day ever.
Russia suspended trading after Moscow’s Micex index crashed 19% in its biggest one-day drop since the 1998 default. The state-controlled VTB bank fell 25pc.
Brazil shut the Sao Paulo exchange after the Bovespa index crashed 15% in panic trading, led by flight from the resource giants Vale and Petroleo Brasileiro. Mexico’s Bolsa was off 7%; India’s Sensex was off 6%.
The Australian dollar went into near-meltdown yesterday, dropping 9.7% against the yen in the largest one-day drop on record.
◊◊◊◊ Now: Gold @ $885.10, Silver @ $11.79, USDX @ 81.15 ◊◊◊◊
◊◊◊◊ Now: DJIA 9,955.50
Filed under: Markets & Economy |