Investors marked yesterday's 18th anniversary of the "black Monday" stock market crash with a heavy bout of selling that drove European stock markets to a seven-week low.
European and Asian markets suffered heavy falls on concerns that rising inflation and interest rates in the US and elsewhere could blunt investors' appetite for risk and drive funds from riskier assets such as emerging markets.
The FTSE Eurofirst 300 index dropped 19.76 points, or 1.7 per cent, to 1,172.7, its biggest one-day fall since July 7th this year, the day of the London bombings.
In the Republic, the Iseq Index of Irish shares dropped 131.91 points to close at 6,473.8. Leading stocks like AIB, Bank of Ireland and Irish Life and Permanent all suffered on the back of investors' jitters.
Around the world, Asia led the way. The casualties included Tokyo, where the Nikkei 225 Average dropped for the sixth day in a row, sliding 1.7 per cent. That took its fall since an October 11 peak to 3.2 per cent.
The tech-heavy Seoul market dropped 2.8 per cent, Singapore eased 2.4 per cent, Taipei fell 2.3 per cent, Hong Kong slipped 1.5 per cent, Sydney retreated 1.8 per cent and India dropped 1.9 per cent.
The selling spread to Europe, which was hit by concerns that rising inflation will put pressure on the European Central Bank to raise interest rates. The biggest faller of the day was the German market, given the high exposure of its largest companies to US exports. The Xetra Dax index dropped 2.1 per cent to 4,845.98.
The falls on other European markets were not so steep, but the UK market experienced its biggest one-day drop of the year. The FTSE 100 fell 1.83 per cent to 5,167.8.
Wall Street was bolstered by a slew of strong earnings reports from heavyweight companies. At midsession, the Dow Jones Industrial Average was up 0.2 per cent at 10,301.91, while the S&P 500 index was flat at 1,177.91.
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