The day began well for North American stock markets but the anticipation of a good day soon evaporated, as nervous investors drove key indexes in both Toronto and New York to triple-digit losses by the trading day's end.
The TSX composite index opened
the day with a 300 point jump but closed down 456 points at 9,600, a 4.5 per cent decline; while in New York, the Dow Jones lost 679 points or 7.3 per cent, while the Nasdaq shed 95 points or 5.5 per cent.
This drop saw the Dow hit its lowest level in five years. At the same time as the market was dropping, the White House strove to assure Americans the government was taking decisive action to stabilize the ailing financial system, it announced U.S. President George W. Bush would make a statement on the economy Friday.
White House press secretary Dana Perino said. "He will assure the American people that they should be confident that economic officials are aggressively taking every action to stabilize our financial system," Perino said. "The Treasury Department, the Federal Reserve and the FDIC [Federal Deposit Insurance Corp.] all have the necessary tools to address the problems we are facing.
"The Treasury Department is moving quickly to use new tools to improve liquidity, which is the root cause of this problem," she said. "Americans should be confident that every effort is being taken to stabilize our markets."
Finance ministers from Canada, Britain, France, Germany, Italy, Canada, Japan and the U.S. have been invited to meet with Bush at the White House Saturday to discuss the global financial crisis.
Canada and the United States are not alone as stock markets in other parts of the world also remained volatile Thursday and investors reacted to interest-rate cuts by central banks and concerns grew in some quarters that the financial crisis could lead to a global recession.
Britain's FTSE 100 lost 1.21 per cent, Germany's Dax dropped 2.53 per cent and France's CAC 40 lost 1.55 per cent.
Hong Kong's Hang Seng index jumped 3.31 per cent, South Korea's key index rose 0.6 per cent while Japan's Nikkei index slipped 0.5 per cent in a day of volatile trading, to close at its lowest level in five years.
Hong Kong, South Korea and Taiwan followed the lead of other central banks by cutting their key interest rates Thursday.