MOSCOW, January 25 (RIA Novosti) – Three major US stock indexes fell about 2 percent on Friday on fears that emerging-market stocks would continue to tumble as local currencies weakened.
The Dow Jones Industrial, the high-tech Nasdaq Composite and the SP 500 overall market benchmark fell 1.96 percent, 2.15 percent and 2.09 percent, respectively, over the day.
Several emerging market currencies including the Russian ruble, Indian rupee, Brazilian real, South African rand, Turkish lira and Argentine peso have abruptly devalued recently.
The Russian ruble hit a historical record low versus the euro on Friday, dropping to 47.32 rubles per euro on the Moscow stock exchange.
“We expect the emerging market selloff to get worse before it starts getting better,” Lorne Baring, managing director of B Capital Wealth Management in Geneva, said in comments carried by Reuters.
“There’s definitely contagion spreading, and it’s crossing over from emerging to developed [markets],” he said.
China’s booming economy is also showing signs of cooling off, with growth of the country’s GDP and industrial output showing minor setbacks from the third to fourth quarter of last year.