U.S. stocks were set to plunge Friday in tandem with worldwide markets, as Dubai World and its debt woes threatened Wall Street’s confidence.
Dow Jones industrial average, Nasdaq and S&P 500 futures plummeted, by nearly 300 points on the pre-market Dow alone, hinting that stocks could take a dive during their abbreviated session on Black Friday.
Futures measure current index values against the perceived future performance, though they’re not always an accurate forecast of stock activity after the bell.
The problems stem from Dubai World, the finance arm of Dubai, which is considering a postponement of payments on nearly $60 billion in debt. The debt was used to fuel a construction boom over the last few years, including its palm-tree shaped island projects, but the Middle East nation was hit hard by a real estate crunch.
Wall Street ended Wednesday on a positive note, with the Dow Jones rising 31 points to hit a fresh 13-month high.
Stocks were boosted by tumbling jobless claims, which the Labor Department said hit a 14-month low last week, and a rise in new home sales.
(Source: CNN Money)
Join the official YWN WhatsApp status
3 Responses
I don’t think even half the people reading this article could find Dubai on the world map.
1. Those aren’t the only bonds people should worry about. A large number of businesses and consumers are in debt beyond their ability to pay.
2. Some of the Dubai bonds are “Islamic bonds” (very similar to our Heter Iska), raising the questions of whether they are truely “secured” or if in fact they actually (what they say they are) agreements to share in ownership and profits, and are “last in line” to get paid after other creditors (since having an ownership or partnership arrangement to avoid interest means you are an owner, and the owner gets paid last, if at all, when the businesses flops).
Wow wee akuperma, I didn’t know that there were yeshivaleit involved with the Association of Communities Organizing for Reform Now. They couldn’t shteig in the Beis Medrash so they decide to join a criminal enterprise?
Awww. Isn’t that a shame. The Dubai arabs don’t have any money to spare to pay their palestinian brethren to kill my fellow Jewish brothers and sisters in Israel. May the rest of the rest of the barbaric, spoiled bedouins of the Arabian peninsula suffer the same fate. Amen!!