Share gains wiped out in Stockholm

This years gains on the Stockholm Stock Exchange were wiped out shortly after trading opened on Thursday. The OMXS index fell 2.6 percent just after 9am, and kept falling. The index is down 0.6 percent compared to the start of the year.

Shares in all sectors fell. Betsson, Seco Tools and Hexagon were the big losers, falling more than six percent. Björn Borg and Kinnevik were among the winners.

Instability in the US mortgage market was behind the falls.

“There are more mortgage lenders who are going bankrupt. This is the source of [the instability],” said Rodney Alfvén, chief analyst at Chevreuz Nordic.

Falls on Wall Street and on leading Asian markets were less important for Stockholm, Alfvén said.

“Above all, it’s the uncertainty over credit in the US that is making things tough, particularly for the finance business in terms of granting credit and so on. This is what is also hitting Europe,” Alfvén said.

He added that the autumn would see continued market nerves, which would continue until all the credit market problems were known about.

“I can’t say how long it will take, but it will certainly be two or three months to work through it.”