Financial and commodities markets trembled today as war clouds gathered over Iraq amid a US ultimatum to the UN Security Council to end its impasse over backing military action within 24 hours.
Britain's top shares slumped this morning. The FTSE 100 benchmark index was down 67.2 points, or 1.9 per cent, at 3,534.6 by 8.15 a.m. and nine out of every ten stocksfell in early trade.
Asian share prices tumbled, the dollar fell against major currencies and oil prices spiked higher as speculation grew military action against Saddam Hussein's regime was imminent.
In Japan, the Tokyo Stock Exchange's Nikkei-225 average lost 131.05 points or 1.64 per cent to close at 7,871.64.
The Australian sharemarket's SP/ASX 200 index closed down 14.0 points or 0.51 per cent at 2,739.1.
A dealer at a North American brokerage in Sydney said the geopolitical developments ended any positive sentiment from Friday's global market gains.
South Korea's composite index dived 4.17 per cent to 515.24 and Taiwan's key index fell 2.64 per cent to 4,357.99.
Hong Kong's Hang Seng index ended morning trading 1.51 per cent lower at 8,821.31 and Singapore's Straits Time index ended the early session down 1.95 per cent at 1,226.46.
In New York on Friday, the Dow Jones industrials closed up 0.49 per cent at 7,859.71 and the tech-heavy Nasdaq edged down 0.44 points to 1,340.33. The dollar slipped against major currencies today amid the heightened war tensions.
Oil prices surged in Asian trade as the US and its allies stepped up preparations for a military assault against Iraq.
The New York light sweet crude contract for April delivery, was trading at 36.57 dollars a barrel in after hours trading, up 1.19 dollars from the close of 35.38 dollars in New York on Friday.
The contract earlier Monday surged to a high of 36.95 dollars a barrel.
Oil prices could break through 40 dollars when the US and its allies push ahead with plans to attack Iraq, said Mr Victor Shum, a senior partner at energy consultant Purvin and Gertz Inc.
"Quite likely we can expect to see a price spike... it's anybody guess (how high prices will rise)," Mr Shum said.
AFP