ECONOMY & MARKETS

Fears of a global credit squeeze and worries about U.S. economic strength swept across financial markets on Monday, shaking up stocks, knocking the dollar to a 15-year low and straining popular currency trades.

Samsung Electronics Co. Ltd. shares opened lower on Monday after a power outage at a major plant near Seoul on Friday affected some of its chip production lines, but the stock quickly pared back losses.

More signs of weakness in the mortgage market, another surge in oil prices and a Federal Reserve rate decision could create more turbulence for Wall Street this week.

Japan's Nikkei average fell 0.87 percent on Monday as exporters such as Canon Inc. lost ground on a tumble on Wall Street and a stronger yen, while bank shares slid again on subprime lending worries and much weaker first-quarter earnings than expected.

Asian stock markets tumbled on Monday with financial shares such as Macquarie Bank hit by global credit jitters, while fresh concerns about the health of the U.S. economy knocked the dollar lower.

Stocks slid sharply on Friday after Bear Stearns said credit markets were in their worst shape in two decades, while jobs data aroused further concerns about weakness in the economy.

The dollar steadied against other major currencies on Friday, hugging tight ranges as investors shifted their focus to upcoming U.S. employment data from the credit and stock market volatility of recent weeks.

World stocks were steady on Friday, off this week's 3-1/2 month low, as robust corporate earnings highlighted the underlying strength of the global economy, calming concerns about a global credit squeeze.

Stocks rallied late in the session on Thursday for the second day as enthusiasm about strong profits offset lingering credit concerns, although a modest flight-to-quality bid gave bond prices a slight lift.

U.S. securities market regulators are pursuing a suspected insider trading ring that appears to have been operating in many stock and options markets over several months. Authorities said tracking the suspects has been a team effort among the major exchanges and federal regulators.

World stocks bounced off this week's 3-1/2 month low on Thursday and credit markets stabilized as upbeat corporate earnings tempered worries about a global credit crunch which had prompted a sell-off of almost a fortnight.

The euro briefly edged up against the dollar on Thursday after the European Central Bank president said 'strong vigilance' was needed to stem inflation risks, signaling a possible September rate hike.

Strong cellphone demand in Asian emerging markets boosted Nokia Oyj's second-quarter sales and profits, sending its shares to their highest level in more than five years.

The Standard & Poor's 500 index slid in a highly erratic session on Wednesday, as concerns about worsening credit conditions persisted and a sharp downturn in the price of oil sent energy companies' shares lower.

The dollar rose against the yen on Wednesday, rebounding from earlier three-month lows in choppy trading, as the U.S. stock market steadied after its recent heavy losses.

Stocks fell and currency markets churned on worries about worsening credit markets and a move away from risky investments.

The recent slide in European stock markets has not signaled the turning point in the four-year bull run, chart analysts say, but stocks could struggle to recover those losses in the short term.

Shares of Sun Microsystems Inc. rose more than 4 percent on Tuesday after the computer server maker said it hard turned around from a loss a year ago to post a higher than expected profit.

Stocks around the world bounced back sharply on Tuesday as volatile credit markets stabilized and after Wall St took heart from still-brisk corporate earnings growth and the smooth wind-up of another troubled hedge fund.

Asian shares slid on Monday after U.S. stocks suffered a second day of heavy losses on worries that companies were facing tighter credit conditions, while uncertainty in global equity markets drove up the yen. Worries that problems in the housing market could spill over into other parts of the U.S. economy -- Asia's main export market -- and that tighter credit would cause takeover activity to slow, saw the S&P 500 index suffer its worst week in nearly five years.

Stocks were little changed on Monday after gyrating between negative and positive territory in the first half hour as worsening sentiment about the global credit environment countered optimism about economic growth. Tightening lending standards threaten to slow or halt the heavy pace of corporate buy-outs that have fueled a rally in equities.

Oil prices dipped on Monday as investors took profit after U.S. crude prices leapt more than $2 to their second-highest close on record, fuelled by upbeat signals on the U.S. economy and nagging supply worries.

The yen hit a three-month high against the euro in early trade on Monday as the sell-off in global equity and credit markets prompted investors to cut back on risky positions such as carry trades.

Getting back on the bull will be no easy task next week, particularly after the meltdown stock investors endured over the past two days.

U.S. stocks plunged for a second day on Friday, in the worst week for the S&P 500 in nearly five years, as tightening credit conditions led to concerns that takeovers would slow. Losses accelerated in the final minutes of trading, taking the Dow industrials down more than 200 points, a day after an equities sell-off that wiped out more than $300 billion in the value off the S&P 500.

Shares of Ford Motor Co. on Friday gained nearly 2 percent after the struggling automaker posted a surprise second-quarter profit, prompting Wall Street analysts to forecast a faster turnaround and a narrower loss for the year.

Shares of Blackstone Group LP, the private equity firm that went public late last month, fell as much as 7 percent on Friday, amid a debt market freeze that has shut off funding for leveraged buyouts. Blackstone's stock has fallen 21 percent since its June 21 debut, making it one of the year's worst performers for U.S. IPOs.

Stocks and high-yield corporate bonds are back to appropriate levels, the world's biggest bond fund manager said on Friday, a day after fears of spreading problems in the housing market triggered a rout in global stock and credit markets.

European shares bounced back while the yen and government bonds erased gains in volatile trade on Friday after robust corporate results eased credit fears which have triggered sharp moves across financial markets.