Global shares slide on growth fears

Global shares have fallen sharply as concerns about weak global economic growth knock investor confidence, the BBC reports.

In the US, the Dow Jones opened down almost 300 points, or 1.8%, at 16,025, before recovering slightly. European markets were also sharply lower.

The Dow is down about 1,000 points, or 6%, in the past month.

Oil prices also continued to slide, with Brent crude falling below $85 a barrel and US light crude dipping to $81.60.

Brent crude has fallen by 20% since the summer on concerns of oversupply, as output increases and forecasts for future demand fall because of concerns about sluggish global growth.

On stock markets, the main Cac 40 index in France fell 2.4%, while Germany's Dax index and the UK's the FTSE 100 were down 1.8%.

Government bond prices rose as investors sold equities and looked for the relative safety of fixed-income investments.

Long-term US Treasury prices jumped to two-year highs as yields fell sharply. Bond yields always fall when prices rise, reflecting increased demand for the instruments.

Figures released this week have shown inflation falling to five-year lows in India, China and the UK, prompting some commentators to talk about the possibility of deflation.

Recent economic figures have increased fears that the global economic recovery may be running out of steam.

On Tuesday, Germany cut sharply its growth estimates for this year and next, while last week the International Monetary Fund cut its forecast for global economic growth, warning that the recovery was "weak and uneven".

Disappointing economic data published on Wednesday helped to undermine investor confidence further.

US retail sales fell by a worse-than-expected 0.3% in September, the Commerce Department reported, while US producer prices dipped 0.1%, the first drop in more than a year, the Labor Department said.

"Incoming economic data is prompting many investors to question their faith in the belief that central bankers can change the economic dynamic with easy monetary policy," said Briefing.com analyst Patrick O'Hare.

"Macroeconomic weakness, and the seeming inability of monetary policy to counteract it, has the market in a selling stupor at the moment."

Central banks have been holding interest rates low to keep borrowing costs down in order to stimulate spending and general economic growth.

Some, including those in the UK and the US, have also been buying up assets with newly created money in a more unconventional bid to boost lending and growth.