European shares gave up early gains as bank stocks dropped again and losses in Asian markets sent investors scurrying for save havens. Ivor Bennett reports.
Just in case you'd missed it, the global markets horror show is in full swing. Lent-inspired fancy dress in Frankfurt doing nothing to lift the mood. Baader Bank's Robert Halver. (SOUNDBITE) (German) HEAD OF CAPITAL MARKET ANALYSIS AT BAADER BANK, ROBERT HALVER, SAYING: "Let's not be fooled, a banking crisis in Europe is next, not as big as before but a lot of European banks have a lot of stakes in the U.S. fracking business and now they are worried about getting their money back." Shares in several Italian banks had to be suspended their drops were so sharp. The sector enough to drag the FTSEurofirst 300 index towards its lowest close since 2013. CEBR's Vicky Pryce. (SOUNDBITE) (English) CHIEF ECONOMIC ADVISER, CEBR, VICKY PRYCE, SAYING: "The concern is they may have been exposed to firms that are suffering from the drop in oil prices for example. They have also been lending to companies that have been relying on growth continuing, exports to emerging markets of course are suffering. So there is a real concern that there may be an increase across Europe in non-performing loans." And that's not all. The uncertainty over the direction of U.S. rates and the slowdown in China are also causing concern. Japan's Nikkei suffering its biggest daily drop in nearly three years. (SOUNDBITE) (English) CHIEF ECONOMIC ADVISER, CEBR, VICKY PRYCE, SAYING: "No doubt the slowdown is intensifying in a number of areas. I think the Chinese hard landing now seems more likely than it ever did. Of course we can never be sure what the figures from China are telling us. But the emerging market slowdown is a very very important factor in all of this." So too is oil. The International Energy Agency predicting the glut will get worse before it gets better.