George Soros, the billionaire financier, helped unsettle markets by voicing fears that share prices had further to fall. In an interview, he said: "It's a bear-market rally because we have not yet turned the economy around. This is not a financial crisis like all the other financial crises that we have experienced in our lifetime." Markets across the world slid as a raft of bad news stalled the powerful rally that has fuelled optimism for over a month. In Britain, fresh concerns over bank stability and oil prices pushed the FTSE 100 index down 63 points, or 1.6pc, at 3930.5. The Dow dipped 2.3pc to 2789.6 on fresh concerns that the bank bail-out would not stabilise US lenders and after a report showed that chief executives' confidence in the economy had fallen in the past few months. Germany's DAX lost 0.6pc and France's CAC 0.9pc. In Asia, Japan's Nikkei was down 0.3pc, Hong Kong's Hang Seng sunk 0.3pc and Australia's ASX slipped 1.3pc after interest rates were cut to a 49-year low. The trend threatens to undo the recent two-week rally, in which time the FTSE 100 has jumped 13pc, the S&P 24pc and the Nikkei 25pc. Like Mr Soros, analysts at Morgan Stanley warned the bear market was not over. They said in a note: "We have to decide whether this is towards the end of another bear market rally that we should sell into now that hope has grown, or the start of a much larger advance, maybe even a new bull market. Our decision is to sell into strength now." Optimism around the world was boosted last week after the leaders of the G20 countries agreed to a six-point plan designed to ensure the global recession does not turn into a depression. But now there are concerns the leaders did not go far enough. Mr Soros, whose flagship Quantum Endowment Fund generated 8pc returns last year compared to an average decline of nearly 20pc among other hedge funds, told Bloomberg Television: "The recovery will look like an inverted square root sign. You hit bottom and you automatically rebound some, but then you don't come out of it in a V-shaped recovery or anything like that. You settle down, step down. "[President Barack Obama] has done very well in every area, except in dealing with the recapitalisation of the banks and the restructuring of the mortgage market.George Soros warns shares will fall further
Stock markets slumped for a third day in a row as a welter of warnings that last week's bounce was no more than a "bear market rally" ended hopes of a sustained recovery.
Wednesday, 8 April 2009
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