Russia, Indonesia Halt Trading in Worst Emerging-Market Rout in 20 Years

[Purveyor]

Oct. 8 (Bloomberg) -- Russia, Indonesia, Ukraine and Romania shut their stock exchanges and Brazilian stocks fell to the lowest in two years in the worst week for emerging markets in at least two decades on concern that a deepening credit crisis will halt global growth.

Russia's Micex Index dropped 14 percent, having already slumped 20 percent this week, before trading stopped at 11:05 a.m. in Moscow. The Jakarta Composite index fell 21 percent in its biggest weekly slump in at least 25 years, according to data compiled by Bloomberg. Brazil's Bovespa index dropped for a fifth day, heading for the lowest since October 2006.

Investors are fleeing on concern the worsening global credit crisis will cause more banks to collapse and push the global economy into recession, lowering the price of the commodities that drive developing nation economies. The benchmark MSCI Emerging Markets index is headed for its worst weekly decline since it was established in 1987 after falling 21 percent.

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`Survival Mode'

``The market is in survival mode,'' said Ralph Sueppel, chief economist at BlueCrest Capital Management Ltd. in London, which manages $2 billion in emerging-market assets. ``Concerns over liquidity, counterparty risk, and mark-to-market risk limits prevent institutional investors from doing what they are supposed to do: correcting misaligned asset prices by seeking a profit.''

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BLOOMBERG: http://www.bloomberg.com/apps/news?pid=20601095&sid=a.Kuy4FGAQM8&refer=east_europe