Video

European shares tumble in early trade with investors rattled by fears of a contagion from the distress sale of Bear Stearns in the US, a plunging dollar and record oil prices. Analysts believe that the downward trend will continue. Global stocks fell sharply on Monday (March 17) as a fire sale of Bear Stearns and an emergency Federal Reserve cut of a key lending rate sparked fears that a worldwide credit crisis will claim more casualties. European shares sank more than 3 percent, following a sell-off in Asia where Japan's leading indexes shed more than 3.5 percent. Wall Street looked set for a sharply downward open. Philippe Gijsels (pronounce Geijzelz), a senior equity strategist at Fortis, said the purchase of Bear Stearns for two dollars a share highlights problems with the valuation of some financial companies on the market. ''That JP Morgan is buying Bear Stearns outright for two dollars a share, which is basically very low, that puts a little bit into question the valuation case that some people have been making that financial sectors and the market in general is very cheap. If they sold for that price, may be that question should once again be asked,'' Gijsels said. On Sunday (March 16), JPMorgan Chase & Co said it would buy Bear Stearns for a rock-bottom price of $2 a share, valuing the U.S. investment bank at the centre of a widening global credit crisis at about $236 million. Governments have tried to soften the crisis by injecting money in the economy. In Feb...