Tuesday, July 24, 2012

US Stock Market Plunges on Eurozone Debt Crisis

US stock markets plunge on eurozone debt fears

Tue Jul 24, 2012 12:28AM GMT

US stock markets have dropped amid concerns about the eurozone debt crisis, renewed fears that Spain may be unable to avoid a costly bailout, and talk of a possible Greek exit from the eurozone.

On Monday, the Dow Jones Industrial Average once lost over 200 points but finished the day at 12,721.46, down 101.11 points (0.79 percent), AFP reported.

The Standard & Poor's 500 Index fell 12.14 points (0.89 percent) to 1,350.52, while the Nasdaq Composite Index shed 35.15 points (1.20 percent) to 2,890.15.

Meanwhile, the shares of fast-food giant McDonald's plunged 2.9 percent, and ExxonMobil lost 0.9 percent as oil futures prices fell over 3.0 percent.

The Wall Street rout extended last week's losses on the news from Spain, raising fears that the eurozone's fourth-largest economy may need to be rescued.

The Spanish economy is suffering from the aftershocks of a real estate bust that has devastated not just the banks, but families as well.

Battered by the global financial downturn, the Spanish economy collapsed into recession in the second half of 2008, taking with it millions of jobs.

The worsening eurozone debt crisis has increased Spain's financing costs and the country is seeking a European Union bailout similar to the one Greece received.

Greece has been at the epicenter of the eurozone debt crisis and is experiencing its fifth year of recession, while harsh austerity measures have left about half a million people without jobs.

One in every five Greek workers is currently unemployed, banks are in a shaky position, and pensions and salaries have been slashed by up to 40 percent.

Greek youths have also been badly affected, and more than half of them are unemployed.

The long-drawn-out eurozone debt crisis, which began in Greece in late 2009 and reached Italy, Spain, and France last year, is viewed as a threat not only to Europe but also to many of the world’s other more developed economies.

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