Tel Aviv brokers.
(photo credit: REUTERS)
There was again major tension on the Tel Aviv Stock
Exchange (TASE) Monday morning, as Hong Kong and China shares retreated
for the second day on market pressures following Standard & Poor's downgrade
of United States long-term credit rating on Friday.
On Sunday, the Tel Aviv 25 Index lost seven percent after the lowering
of the US credit rating, sending panic throughout the global economy.
The Tel Aviv 25 had lost 6.3% last week.
almost 7% due to US credit-rating downgrade
European stocks see biggest weekly fall since 2008
As feared, the TASE looked set for a ninth straight day of losses with
the Tel Aviv 25 Index down a further 2.5% on the opening. But within
the first half hour the losses moderated and at 9:30 a.m. the Tel Aviv
25 Index was down 0.9% to 1064.76 points.
Clal Finance chief investment manager Kobi Feller, striking an
optimistic tone, said, "Panic on the markets will fade during the week
and it is worth taking advantage of the sharp falls to buy shares."
Meanwhile, Chinese state-run media said Monday that the US must rethink
its huge military outlays, big footprint abroad and summon the courage
to defuse debt woes, reflecting the political pressures on Beijing with
its big stash of dollar assets.
At the same time, Hong Kong and China shares retreated for a
second-straight session, pressured by an acceleration of derisking from
equity investments following Standard & Poor's downgrade
of the long-term credit rating of the United States late on Friday.
Commentaries in official Chinese media said the economic troubles
facing the United States and European Union grew out of the political
dysfunctions of the Western democracies and their unsustainable
appetite for spending.
The Xinhua news agency also linked the weekend US debt downgrade to
another Chinese complaint: US military spending, which Beijing sees as
aimed at frustrating China's rise.
"Since the collapse of the Soviet Union, the United States, as the
world's sole superpower, has relied on its powerful military to meddle
everywhere in international affairs, advancing hegemonism, and paying
no heed to whether the economy can support this," said a commentary
issued by Xinhua, which noted the heavy bills for wars in Iraq and
Fears of a worsening crisis in Europe exacerbated the prevailing
risk-off mood, plunging the Hang Seng Index and Shanghai Composite
index to their lowest in more than a year as spooked investors
propelled gold to a record on Monday.
The Hang Seng Index was down 4.04 percent at 20,100.2 by the midday
trading break, its lowest level in a year. Turnover was almost 20
percent lower than on Friday, a sign that some investors were sticking
to the sidelines.
The benchmark fell below chart support at its August 2010 low of 20,370
shortly after trading started, which analysts said accelerated selling.
The next support is seen at the July 2010 low of 19,777.