Stock markets across the world cracked yesterday, forcing Wall Street to suspend trading on a key futures contract to stem panic-selling while Moscow shut for business altogether. Sharp losses in New York, London, Europe and the Far East raised the spectre that governments may be forced to impose emergency holidays to avert a meltdown across world stock markets. Before Wall Street opened yesterday, American regulators suspended all trading of Dow Jones futures contracts, which had plunged.
Such contracts allow traders to bet on the future direction of the Dow Jones index. The plunge had triggered an automatic circuit breaker, which halts trading to prevent a market sliding into freefall. Nouriel Roubini, Professor of Economics at New York University, said his prediction earlier this week that markets would have to be shut down is already coming true.
`This is the worst financial crisis in the U.S., Europe and now emerging markets that we’ve seen in a long time,” Roubini said. `Things will get much worse before they get better. I fear the worst is ahead of us.”