Sunday, August 7, 2011

Tel Aviv Stock Markets Fall 7%

Call this a bad omen of what may happen to US Markets when they open up tomorrow morning; the first day of trading after the S&P downgrade.

"Tel Aviv shares closed nearly 7 percent lower on Sunday in the first response of a developed market to Standard & Poor's downgrade of the United States' credit rating that has sparked fears of another global recession.

The Israeli market along with a few emerging markets in the Middle East were the first to trade after S&P late on Friday cut the U.S. long-term credit rating by a notch to AA-plus from AAA due to concerns about the country's budget and climbing debt burden.

The TA-25 .TA25 blue-chip index closed down 6.99 percent to 1,074.27 points and is down 18 percent since the start of the year. The broader TA-100 .TA100 slid 7.2 percent.
The Tel Aviv market opening was delayed by nearly an hour as circuit breakers kicked in when shares fell more than 5 percent in pre-market trade.

The last time circuit breakers were used was on Sept. 21, 2008, after the collapse of Lehman Brothers, a stock exchange spokeswoman said.

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