(Corrects paragraph 7 to say Chesapeake had tapped existing
adviser Kirkland & Ellis to explore restructuring options, not
that it had hired restructuring lawyers)
* S&P financial index falls about 3 pct
* Cost of insuring European financials' debt surges
* Oil prices fall, Chesapeake shares plunge over 50 pct
* 10-year Treasury yield hits 1-year low
* Spot gold hits highest level since June
By Sam Forgione
NEW YORK, Feb 8 (Reuters) - Stock indexes worldwide tumbled
on Monday, led by banking stocks in Europe and technology stocks
on Wall Street on persisting fears of a global economic
slowdown, while benchmark 10-year Treasury yields hit their
lowest in a year on demand for assets deemed less risky.
European shares extended the previous week's big losses,
with the FTSEurofirst 300 .FTEU3 index of top regional shares
falling more than 3 percent to its lowest in 16 months. Cyclical
sectors such as banking and automobiles bore the brunt of the
selloff.
The STOXX Europe 600 banking index .SX7P tumbled over 5.5
percent, putting the index's losses for this year at more than
24 percent on concerns about banks' profit outlook amid a
negative rate environment.
Wall Street continued Friday's technology-led selloff, with
the benchmark S&P 500 stock index .SPX falling more than 2
percent. The S&P financial index .SPSY fell about 3 percent,
with shares of Bank of America (N:BAC) BAC.N , JPMorgan (N:JPM) JPM.N and
Citigroup (N:C) C.N dragging down the index.
The cost of insuring the European financial sector's senior
debt against default also climbed to its highest level since
late 2013.
U.S. crude prices fell after a meeting between Saudi Arabia
and Venezuela failed to reassure investors of measures to
bolster sagging prices.
Shares of Chesapeake Energy (N:CHK) CHK.N fell over 50 percent to
their lowest levels since 1999 after sources told Reuters that
the natural gas company had tapped existing adviser Kirkland &
Ellis to explore restructuring options.
"We need oil to stabilize to provide some confidence for
investors, partly because to a degree, investors' stress is
high, earnings visibility is low, and market internals continue
to weaken," said Terry Sandven, chief equity strategist at U.S.
Bank Wealth Management in Minneapolis.
Brent crude LCOc1 was last down 37 cents, or 1.09 percent,
at $33.69 a barrel. U.S. crude CLc1 was last down 47 cents, or
1.52 percent, at $30.42 per barrel.
MSCI's all-country world equity index .MIWD00000PUS , which
tracks shares in 45 nations, was last down 7.5 points, or 2.05
percent, to 359.07.
The Dow Jones industrial average .DJI fell 379.37 points,
or 2.34 percent, to 15,825.6, the S&P 500 .SPX lost 45.32
points, or 2.41 percent, to 1,834.73 and the Nasdaq Composite
.IXIC dropped 130.44 points, or 2.99 percent, to 4,232.71.
Europe's broad FTSEurofirst 300 index .FTEU3 was last down
3.66 percent at 1,236.11.
Many Asian share markets were shut for the Lunar New Year
holiday. Chinese markets will remain shut this entire week.
Benchmark 10-year Treasury yields reached a one-year low of
1.7400 percent US10YT=RR , as the stock market decline and
concerns about slowing global growth increased investor appetite
for safe-haven government debt.
U.S. 10-year Treasury notes were last up 30/32 in price to
yield 1.7431, from a yield of 1.848 percent late Friday.
"Weakness in global equities is adding pressure on
Treasuries," said Ian Lyngen, senior government bond strategist
at CRT Capital in Stamford, Connecticut, in reference to yields.
The dollar fell to a roughly 14-month low against the yen of
115.170 yen JPY=EBS , partly on doubts about the effectiveness
of the Bank of Japan's negative interest rate policy.
Safe-haven spot gold XAU= reached a peak of $1,198.70 an
ounce, its strongest since June 22.