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Markets hit by Dubai debt crisis

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Markets hit by Dubai debt crisis

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Concern about exposure to Dubai’s debt crisis is putting a squeeze on global markets, with stocks falling in Asia and European markets opening lower.

Banking shares have been among the hardest hit, and the yen has risen to a 14-year high against a struggling dollar. Analysts say investors are cutting their exposure to risk, unwinding deals they believe could be affected. The nervousness comes after Dubai said that two companies planned to delay repayment on billions of dollars of debt, in the first step towards restructuring. The news has raised fears of debt defaults that could hit the global economy, just as it is trying to recover from the financial crisis.