Turkey’s worsening currency crisis sent world equities lower and emerging market currencies under selling pressure yesterday, while gains in large US technology companies kept benchmark indexes slightly higher.

German bond prices, meanwhile, were boosted by investors seeking stable assets.

The MSCI world equity index, which tracks shares in 47 countries, was down 0.3 per cent and 1.3 per cent since Friday’s open as the Turkish lira plunged to a record low, forcing the country’s finance minister to announce an economic action plan to ease nerves.

The lira has tumbled on worries over President Tayyip Erdogan’s increasing control over the economy and deteriorating relations with the United States. It fell as much as 12 per cent at one stage yesterday, then recovered to a loss of 8.5 per cent.

“The plunge in the lira, which began in May, now looks certain to push the Turkish economy into recession, and it may well trigger a banking crisis,” said Andrew Kenningham, chief global economist at Capital Economics.

“This would be another blow for EMs as an asset class.”

Emerging market stocks lost 1.88 per cent.

In the United States, early gains by technology giants such as Apple Inc, Amazon.com Inc and Google-parent Alphabet overshadowed declines in financial companies that are the most likely to be affected by the steep decline in the lira.

“The global financial system is so interconnected that we tend to think of them as a group and financials come under pressure,” said Art Hogan, chief market strategist at B. Riley FBR in New York.

The Dow Jones Industrial Average fell 21.79 points, or 0.09 per cent, to 25,291.35, the S&P 500 gained 2.92 points, or 0.10 per cent, to 2,836.2 and the Nasdaq Composite added 25.62 points, or 0.33 per cent, to 7,864.73 in mid-morning trade.

The euro fell to a one-year low against the dollar yesterday and sank to a one-year trough against the Swiss franc as well.

European stocks fell in early trade yesterday, with a pan-European index of shares down half a percent and the banking stock index as much as 2.6 per cent lower.

The pan-European FTSEurofirst 300 index lost 0.20 per cent.

Safe-haven government bonds were in demand, with yields on German 10-year debt, the benchmark for the euro zone, dropping to a one-month low.

Benchmark 10-year notes last fell 7/32 in price to yield 2.884 per cent, from 2.859 percent late on Friday.

US crude fell 0.5 per cent to $67.29 per barrel and Brent was last at $72.62, down 0.26 per cent on the day. Spot gold dropped 1.3 per cent to $1,195.66 an ounce. US gold futures fell 1.30 per cent to $1,203.10 an ounce.

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