Stocks slide as bank fears spread
Greek stocks tumbled nearly 6 percent yesterday as the fallout from the credit crisis escalated on both sides of the Atlantic. European governments from Germany to Iceland announced a flurry of bank bailouts yesterday, but the rescue deals only heightened fears that the contagion from the US credit crisis has much further to spread before the financial system recovers. European shares fell heavily and money markets remained frozen with banks refusing to lend to each other for all but the shortest periods. In Athens, the benchmark general index fell 5.87 percent to 2,840.80 points with blue chips underperforming, ending 6.25 percent lower. Apart from steep losses in Public Power Corporation (PPC), index heavyweights National Bank and OTE telecom slumped 6.70 percent and 7.65 percent respectively. Banks lost 6.48 percent. «Greek banks may not have the exposure to the assets that have been causing the problems,» said one analyst, «but the cost of money is rising for all lenders and this is likely to appear on profit figures.» The mid-cap FTSE/ATHEX 40 index posted losses of 4.76 percent while the small-cap FTSE/ATHEX 80 index dropped 4.85 percent. Turnover was 257.5 million euros versus 221 million in the previous session.
