Bernard Hickey details the key news overnight in 90 seconds at 9 am in association with Bank of New Zealand, including news that the New Zealand dollar has been the worst performing currency in the world overnight.
The kiwi dollar fell a full cent overnight to 73.9 USc and also fell through a 10 year low to below 75 Australian cents. It has fallen more than 2 cents against the US dollar this week.
The US dollar has been strong overnight as US interest rates continue to rise amd as fears about more problems in Europe drove demand for safe haven assets in US dollars.
The US 10 Year Treasury yield rose to a 7 month high of 3.5%, making the US dollar look more attractive.
Bond investors are worried that the US government's failure to fix its massive budget deficit will stress America's ability to service its debts in the future, and there are signs the US economy is bubbling back to life, boosting inflationary pressures.
US industrial output grew 0.4% in November, which was more than expected, although US consumer price inflation of 0.1% in November was weaker than expected.
News that Moody's has threatened to downgrade Spain's credit rating refocused concerns about the European debt crisis, although Portugal managed to complete an auction of new government debt, albeit with heavy European Central Bank support.
The New Zealand dollar often tends to fall or rise in line with global appetites for risk outside of the US dollar. Vietnam's credit rating was downgraded overnight on fears of a currency crisis and a debt default at shipbuilder Vinashin.
Meanwhile, Fletcher Building has launched an unsolicited takeover bid worth almost NZ$1 billion for building materials maker and distributor Crane Group in Australia. This would mean more of Fletcher Building's revenues come from Australia than from New Zealand for the first time.
See more detail here in its presentation showing details of the deal, which is being funded by new shares and cash.
After the deal 45% of Fletcher's revenues will be in Australia, while 42% will be in New Zealand. Before the deal Fletcher had 49% in NZ and 34% in Australia.
The deal, if agreed, would add 12,000 Australian shareholders, bringing total shareholders in Fletcher Building to 35,000.
Will the largest stock on the NZX leave the NZX for Australia?
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