Do the capital markets have investors concerned?
*Financial Times, by David Wighton, August 6, 2007
“World markets face a nervous start to the week following the plunge in stocks in the US on Friday as concerns mounted about fallout from the US mortgage market turmoil.
The late sell-off in New York followed comments by the chief financial officer of Bear Stearns, who said credit markets were as bad as he had seen in 22 years.
The Wall Street bank’s board will meet today to consider the future of Warren Spector, its co-president and head of capital markets, according to The Wall Street Journal. One analyst said that, if Bear made no statement before the markets opened today, investors would fear there was “more bad news to come”.
US financial stocks were particularly badly hit on Friday, prompting calls for the Federal Reserve to intervene by cutting interest rates. At its meeting tomorrow, some economists expect the Fed to acknowledge the risk that weakness in the US housing market could spread to the broader economy.”
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