Global Equity Markets Tumble on Recession Fears

Stocks in Asia and Europe fell broadly Friday, as investors dumped risky assets amid renewed concerns that the global economy could slip into lower growth or even recession. Asian equities closed much lowed on the session, finishing a difficult week. Japan's Nikkei index fell 2.5%, while Hong Kong's Hang Seng index closed down 3%. European stocks followed suit, with many companies falling near two-year lows. London's FTSE index saw early losses of 2.5%, and Germany's DAX index experienced a 3.5% tumble. Within the past few weeks, concerns have rapidly grown that capital markets are unreasonably exposed to a number of risky assets. Wide swings in the price of stocks is an indication of the worry that has spread throughout the collective market psyche. Gold soared to record highs on stock weakness, benefiting from the flight to safety. Investors also sought government bonds and the Swiss franc. Since S&P's downgrade of United States government debt earlier this month, fears have grown that global growth is staggering, or worse. Recession fears have largely stayed away from discussion until just recently, but the drop in market confidence has appeared to accelerate the situation. European sovereign debt issues, political bickering in the United States, and extended periods of high unemployment have all contributed to the negative sentiment.