Monday June 22, 12:19 PM
European stocks slide
LONDON (AFP) - Europe's main stock markets dropped more than one percent nearing the half-way mark on Monday amid consolidation moves in the mining sector and further woes for ailing group British Airways (LSE: BAY.L - news) .
A respected US forecaster meanwhile warned that the world economy will face a crisis in the next two years even bigger than the downturn currently buffeting the global financial system.
Author Harry S. Dent, who predicted Japan's slide into recession in the 1990s and the present slump, dismissed claims the worst was over for the world economy and that "green shoots" were emerging from the fiscal firestorm.
In late morning trade, London's FTSE 100 index of leading shares dropped 1.49 percent to 4,281.27 points. Frankfurt's DAX 30 (Xetra: news) slid 1.40 percent to 4,771.60 points and the Paris CAC 40 shed 1.55 percent to 3,171.44.
The DJ Euro Stoxx 50 index of leading eurozone shares declined 1.69 percent to 2,393.56 points.
On the foreign exchange market, the European single currency fell to 1.3849 dollars.
"Stock markets are currently looking more vulnerable to weakness than they have done for some months," said IG Index's chief market strategist David Jones.
In London, Anglo American (LSE: AAL.L - news) rallied on news it had received a merger approach from rival miner Xstrata (LSE: XTA.L - news) , but Jones said the market was looking at events with caution.
Anglo American's share price was up 5.58 percent to 1,713 pence, off earlier gains of around ten percent. Xstrata slumped 4.07 percent to 653.3 pence.
Elsewhere on the FTSE 100, British Airways dived 6.82 percent to 127.1 pence following weekend news that the troubled airline was considering selling its OpenSkies subsidiary only a year after it acquired it.
The airline, which last week asked its staff to consider temporarily working for free, is believed to be considering winding up or selling the subsidiary, which runs flights from Paris and Amsterdam to the United States, according to the Observer newspaper.
"Current investor concern is crippling the BA share price which has fallen 30 percent over the last six weeks and is now at a three month low," said City Index market strategist Joshua Raymond.
In a further blow to BA, bitter rival Virgin Atlantic on Monday announced it had placed an order for ten A330-300 mid-sized passenger aircraft worth 2.1 billion dollars (1.5 billion euros).
"Despite the worst economic conditions in decades, we are focusing on sustainable growth in the years ahead using the most fuel-efficient aircraft possible," said Virgin Atlantic's chief executive Steve Ridgway.
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