Record oil prices and plummetting earnings sent European shares tumbling this morning. The Dow Jones Stoxx 600 index fell 1.2% in London while S&P 500 futures slipped 0.3%. Barclays and RBS led the London plunge after Merrill Lynch downgraded Barclays, and RBS announced that it will need to sell shares to shore up capital. Bloomberg:
Analysts have slashed earnings estimates this year on concern more than $260 billion in writedowns and credit losses will cut profit and push the U.S. into recession. Companies in the Stoxx 600 will probably report a 0.5 per cent drop in earnings for 2008, according to data compiled by Bloomberg. That would be the first decline in six years, and is down from 11 per cent growth forecast at the end of last year.
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