WORLD MARKETS IN TURMOIL

What goes up must come down. Pessimism is the word of the day as the financial markets try and adapt to the chaos surrounding the sector. Everything from metals to technology are bracing for softer sales.

American International Group Inc., the world's biggest insurer. AIG shares fell 61 per cent Monday and were down another $1.77 or 37 per cent to US$2.99 Tuesday.

Goldman Sachs Group Inc., the largest remaining independent investment bank in America, reported its quarterly profit plunged 71 per cent to US$810 million. This beat analyst expectations by 10 cents a share, but revenue fell short. Goldman shares lost $4.42 to US$131.08.

Computer maker Dell warned of "further softening" in global demand. This followed Hewlett-Packard's decision to cut 24,600 jobs, eight per cent of its workforce. So the technology market is not providing a safe harbor for investment, nor is it in a position to act as a nexus for a rally to lead markets higher.

Oil Prices and mining stocks are down as investors express concern about a world wide slowdown. Oil prices were down $3.19 to US$92.52 a barrel following a slide of more than $5.00 yesterday. slowdown. The base metals sector is down 5.5 per cent on news that the Asian Development Bank says growth across developing Asia will slow to 7.5 per cent this year from nine per cent in 2007 in the face of rising inflation, turbulent financial markets and weakening world demand.

London's FTSE 100 index lost 166.3 points or 3.2 per cent to 5,037.9. Frankfurt's DAX gave back two per cent while the Paris CAC 40 fell 1.3 per cent.

Japan's Nikkei stock average lost almost five per cent and Hong Kong's Hang Seng index dropped 5.4 per cent after being closed Monday.

China's Shanghai composite index was down 4.5 per cent.

I really am nervous about these storm clouds!