US retail sales collapse in December
News that US retail sales in December fell by a much larger than expected 2.7% saw stock markets around the world plummet on fears that the US recession could be worse and more prolonged than many had thought. The UK market also suffered from a return of fears that the "bank bailout part two" is set to be announced in the short term. This would put the government at serious loggerheads with taxpayers in the UK and also places a substantial question mark over the long-term viability of some of the U.K.'s leading banks.
As 2009 started fairly well for the UK and US stock markets, today's news has caught many traders on the hop amid concerns that stock market prices may well have pushed too far ahead in the short term. A 5% fall in the UK market easily beat the 3% fall in America and a 4.5% fall in both France and Germany as if to underline the fact that the UK economy is regarded by many as one of the weakest in the world at this moment in time.
Just when we started to see some light at the end of the tunnel regarding the UK stock market, there are fears that we may see some investors return to the sidelines.
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