Friday, January 28, 2011

Egypt unrest sparks biggest drop in nearly 6 months

US stocks suffered their biggest one-day loss in more than five months as anti-government rioting in Egypt prompted investors to flee to less risky assets to ride out the turmoil.

The Dow Jones industrial average dropped 166.13 points, or 1.39 percent, to 11,823.70, according to the latest available figures. The Standard & Poor's 500 Index fell 23.16 points, or 1.78 percent, to 1,276.38. The Nasdaq Composite Index lost 68.22 points, or 2.48 percent, to 2,687.06.

European shares fell on concern growth may be crimped, as protests in Egypt escalated and a pick-up in US consumer spending failed to excite markets in the face of a weaker-than-expected overall GDP figure.

The pan-European FTSEurofirst 300 index of top shares closed down 1 percent at 1,143.63 points, its lowest close since Jan. 20, after gaining the previous two sessions.

The Nikkei average fell 1 percent after a cut to Japan's sovereign debt rating, with some analysts saying the downgrade may become a turning point for foreigners who have led a rally in the benchmark since November.

The benchmark Nikkei ended the day down 1.1 percent at 10,360.34 but rose 0.8 percent on the week. The broader Topix fell 1.1 percent to 919.69.