Here's my summary of the key news overnight in 90 seconds at 9 am, including news the Dow is down more than 220 points or 1.7% in late trade as fears about the global economy and Europe's debt crisis returned to haunt investors overnight. See more here at Reuters on the market's slump.
Europe's GDP fell 0.3% in the December quarter and there are doubts that the 75% of Greece's creditors needed to sign on to a 70% plus debt haircut will do it before a Thursday night deadline to avoid a Greek default. Just 20% of creditors have agreed to the deal so far. See more here at Bloomberg.
Continental European stock markets fell more than 3% with concern also growing about Spain's economic and budget position after it unilaterally announced a budget deficit blowout. See more here at Bloomberg on the biggest fall in European stocks since November.
China's decision to cut its growth target to 7.5% from 8% has also unnerved commodity markets, which fell more than 1.4% overnight -- the biggest fall this year. See more here at Bloomberg. The auction overnight of milk powder on Fonterra's auction platform reflected some of those concerns, with prices falling 0.9% in US dollar terms.
US 10 year bond yields fell by the most in 3 weeks as fears about global growth returned and fears about inflation receded. Some local economists said last week that interest rates may be on the rise as the global economy recovered, but this week local wholesale interest rates have been flat to falling as the global doubts returned. See more here at Bloomberg.
However, the effects of that fall in Fonterra's milk powder prices were cushioned somewhat as the New Zealand dollar also fell overnight, as it often does in tune with appetites for risk on global markets and with expectations about global growth.
The New Zealand dollar fell to 81.1 USc this morning and is well down from over 84 USc last week. See our interactive currencies chart below.
The Australian dollar also fell overnight, in part driven by confirmation by the Reserve Bank of Australia yesterday afternoon of its easing bias, in case the global economy slows further.
Finally, 'Sir' Allen Stanford, the Texan cricketing billionaire who used a 'bank' in Antigua to run a US$7 billion Ponzi scheme, was convicted of fraud overnight.
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