It is now almost two years since the start of credit crisis. The challenging conditions that impacted financial markets for the past have continued and deepened. The financial shock that erupted in August 2007, as the U. S. sub prime mortgage market was derailed, has spread quickly and unpredictably to inflict extensive damage on markets and institutions at the core of the financial system.
The financial market clouds hanging over the global economic horizon have darkened substantially in 2008 and for 2009. The announced losses of banks have reached billion as at the end of November 2008. Even final heavyweights and numerous others large European banks have to be bailed out. The collapse of Lehman Brothers in September 2008 has had a profound impact on the entire financial and securities industry, from which they are still to recover.
The money markets are still facing severe challenges as governments across the world in a concerted effort have pledged to support the beleaguered financial system and economy from collapsing. Regional banks, too, are facing severe pressures on their stock prices. Recent fall in regional stock markets, particularly United Arab Emirates, Saudi Arabia, and Qatar markets exemplify the complete loss of confidence of investors in stock markets.
The ongoing stress in the money market activities is leaving a great scar in the investment world. What would be the performance of the stock markets in the future? Is there a chance of recovery?