Britain and Europe
Disappointing economic data weighed on the FTSE, CAC and DAX, raising worries of an economic slowdown. Unemployment showed ominous signs of rising while manufacturing, especially in Germany but also in Britain, suffered from weakening export demand. Tax cuts in Germany did not bolster domestic demand either. Equities investors continue to look overseas for direction. Morale suffered when U.S. indexes sank, especially in the technology, media and telecommunications areas. The collapse of merger talks between major telecommunications companies added to the bad news. On Friday, a mostly weak U.S. employment report accompanied an alarmingly weak purchasers' survey - no help to the markets.

The EMU countries are not as insulated from weakening world growth as the ECB would like to believe. And it isn't only exports that are suffering. Profits of European companies with large overseas stakes also are hurting because of lower sales, and profits, in these markets.

Asia
The focus remains on the Nikkei. Asian technology shares continue to share their fortunes with those on the Nasdaq. Also acting as a drag on the Nikkei are exporters. Their shares fell on concern that the stronger yen will hurt their business. And if that weren't enough, investors continue to have lingering doubts about the health of Japanese banks and the economy.

The market showed little reaction to draft government guidelines on economic and fiscal reform, including cuts in public works spending and an end to the banks' bad debt problem. However, the markets next week will be watching for indications whether Japanese authorities will intervene to prevent the yen from rising further.

Only the Australian all ordinaries and the South Korean Kospi are in positive territory in the first five months of 2001. The Hong Kong Hang Seng and Singapore Straits indexes, feeling the pressures of lower U.S. markets and growth, are below their December 31, 2000 levels.

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

The Bottom Line   •   Looking Ahead