9.30am update (Guardian) ---------------------------------------------------------------------------- ---- London market slumps almost 200 points
Mark Tran Wednesday June 26, 2002 The London market fell nearly 200 points in the first minutes of trading today, engulfed by the Wall Street scandal over US telecoms giant WorldCom. In a financial debacle that threatens to overshadow Enron, WorldCom said last night that an internal audit revealed that some $3.8bn (£2.5bn) of operating expenses had been improperly recorded as capital spending, boosting cash flow and operating margins. The latest blemish on US corporate integrity shattered investor confidence, already fragile from Enron and worries over the strength of the US recovery. Investors dumped shares on the London stock exchange in early trading, sending the FTSE down 185.6 points or 4% to 4,445.4. The market is fast approaching its post-September 11 low, when it sank to 4,433.7 on September 21. Tom Hougaard, trader at financial bookmaker City Index said a "whole panic wave is in motion. This news comes at a very critical point in the markets and although I am aware that the volume in the overnight market is thin and liquidity is low, the tone is set for a very scary day. The losses amongst pension funds and portfolio managers will be huge and the whole Enronitis wound has been ripped right open once again." Louis Proyect Marxism mailing list: http://www.marxmail.org
