Britain and Europe
European markets rode the roller coaster last week, as investors showed deepening concern that the sinking indexes had not reached the bottom yet only to see them rise out of the ashes on flimsy news. Then hopes reversed yet again by local earnings warnings and the gravitational pull downward of U.S. markets. The sum of all of these gyrations led to another down week for the London FTSE, Paris CAC and Frankfurt DAX.

The markets were depressed by softer economic indicators, including the important purchasing managers and EU sentiment index, which all declined in March. The FTSE had already factored in the 25 basis point reduction in interest rates by the Bank of England and stayed focused on poor earnings and U.S. market behavior, rather misbehavior.

Asia
When the week was done in Asia, markets tracked here were - decidedly mixed. Australia's all ordinaries recovered some of its aplomb after the Reserve Bank of Australia cut its policy making interest rate by 50 basis points to 5 percent. The rally managed to pull the index above 2000's year end value.

The Nikkei was buffeted by the combination of a poor Tankan survey (see indicator scoreboard below), relief that the fiscal year end was over and uncertainty about how the government would resolve the bad loan crisis in the banking industry, if indeed it ever would. The plan, which was delayed from Wednesday until Friday because of internal bickering, left much to be desired. Details and specifics of how the plan would work were missing, leaving investors' skepticism unrelieved about the bailout's success.

The plan is under intense scrutiny because of the banking systems' close call at fiscal year's end March 31, which saw it narrowly avoid paper losses of trillions of yen. The small recovery in the Nikkei then was enough to assuage immediate concerns about the banking system's stability. The emergence of Japan's mega-banks in recent years has created entities that have too much of everything - including bad loans and more stock holdings than the law allows.

Introduction   •   Global Stock Market Indexes   •   Recap of Global Markets   •   Currencies   •  Indicator Scoreboard

The Bottom Line   •   Looking Ahead