Europe and Britain
European equity markets slumped on persistent worries about economic growth. The Frankfurt DAX and Paris CAC hit one-month lows while British stocks fell to a two-month low. On Thursday the European Central Bank said economic growth would remain subdued in the coming months. The ECB expects the eurozone economy to grow between 1.1 and 2.1 percent next year, less than its previous estimate. Investors were again tempted by other assets as the forecasts for growth in the eurozone stayed anemic.

The FTSE 100 has declined in 10 of the last 11 sessions and has lost 7 percent since the end of November. The losses over the last week dragged the index to its lowest close since October 10th. A weak performance on Wall Street added to the pressures on overseas indexes. Analysts said that the drop was because of a general absence of good news. London markets have been pummeled recently on concern that skyrocketing housing costs and heavy consumer indebtedness will hurt demand next year. There also is a growing awareness that heavy government debt may force the Bank of England to raise rates in the next 12 months.

Asia
All indexes slumped last week with the exception of the Singapore Straits Times. Japanese indexes were particularly hit by dreary economic data. The Bank of Japan's Tankan survey, which was released early Friday morning, added to the gloom. Although the overall numbers improved - respondents were less negative than in September - most expect no real pickup in 2003 and even worse, another recession. While large manufacturers benefit from exports and overseas business activities, smaller companies must rely on stagnant domestic conditions for business.

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