Tuesday was another rollercoaster day for Europe’s financial markets as shares fell to their lowest close in more than two years.
Trading was very choppy with investors still deeply worried that the euro zone debt crisis is getting worse due to the political discord in the region, and that major economies are headed for recession.
Analyst Robert Halver, with Baader Bank in Frankfurt said: I guess many are not willing to invest in this crazy market. That’s why we still have this high level of resignation.”
European bank shares hit their lowest in almost 30 months; many of them are very exposed having lent billions to euro zone peripheral countries now seen as at risk of default.
There were exceptions: London’s FTSE 100 rose one percent as investors snapped up bargains — shares that they consider to be good value because their prices have fallen so much.
Beaten-down mining and integrated oil stocks led the bounce back, having so far experienced their worst year since 2008, the year Lehman Brothers collapsed.
And Switzerland’s share index climbed over four percent after the country’s central bank moved to stop investors buying the Swiss franc as a safe haven from uncertainty.
As a result Swiss exports will have an easier time. The value of euro shot up against the franc.