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Dubai Balks at Debt Payment, Rattles Global Markets
Posted By admin On November 26, 2009 @ 11:12 am In Featured Stories,Old Infowars Posts Style | Comments Disabled
November 26, 2009
Stock markets in Germany, France, Spain and Italy were all down about 2pc in early afternoon trading as investors retreated from riskier assets. Investors spent the morning digesting the news that Dubai World, the government investment company with $59bn of liabilities, is seeking to delay repayment on much of its debt. Price for European government bonds rose as investors moved money into safer assets.
“Dubai isn’t doing risk appetite any favours at all and the markets remain in a vulnerable state of mind,” Russell Jones, head of fixed-income and currency research at RBC Capital Markets, told Bloomberg. “We’re still in an environment where we’re vulnerable to financial shocks of any sort and this is one of those.”
The credit default swaps, instruments investors use to protect themselves against a borrower defaulting, linked to Dubai’s debt jumped more than 100 basis points to 571. Fears over Dubai’s finances rippled out to a host of other emerging-market assets, including Russia’s Micex stock index and Vietnam’s currency
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