Global Markets Retreat Ahead of Fed Move

European stocks followed declines in Asian markets as news of more subprime woes overshadowed an anticipated 50 basis point rate cut from the Federal Reserve and some positive economic data from the US, AFP reports. London’s FTSE 100 was down 0.85%, the Paris CAC was off 1.54%, Frankfort’s DAX 30 dipped 0.67% and the Euro Stoxx 50 was off 0.80%.

Investors retreated after Swiss banking giant UBS announced a $4.03 billion loss due to subprime exposure, also worrying the Fed might trim its expected rate cuts to 0.25% after data showed consumer confidence and durable goods orders outperformed expectations. Japan’s Nikkei fell 1%, Australia’s S&P/ASX slipped 1.7%, Hong Kong’s Hang Seng closed down 2.6%, Korea’s Kospi tumbled 3%, and Shanghai fell 0.9%.