Concern that a global downturn will hurt company profits has frightened investors and caused stock prices to fall around the world.U.S. stocks fell sharply in today's (Friday's) trading, with the Dow, the S & P 500 and the NASDAQ indexes losing between three and four percent.
Key U.S. indexes fell even further in earlier trading. European markets also fell, closing down as much as five percent after a report that the British economy is on the brink of recession. The report says the economy shrank by half-a-percent in the third quarter.
It is the first contraction of the British economy in 16 years. Asian investors reacted to disappointing earnings reports from major companies with a massive selloff. Key indexes in Japan and Hong Kong lost more than eight percent. And Russia's battered stock markets fell more than 10 percent, prompting officials to suspend trading on the MICEX.
But some new data on the U.S. housing market offered a glimmer of hope today. Home resales in the United States rose more than five percent in September from the previous month, as falling home prices began to attract some buyers. Severe problems in the U.S. housing market sparked the global financial crisis.
U.S. President George Bush has invited leaders of wealthy nations and the heads of major developing economies to a summit on November 15th that will focus on the global financial crisis. Russian officials say President Dmitry Medvedev plans to attend the gathering.