David Chaston details the key news in 90 seconds at 9 am in association with Bank of New Zealand, with news that the European Central Bank has raised its benchmark rate by 0.25% as expected to 1.5% and has signaled its support for Portugal. It has abandoned its credit rating requirement for collateral security there, but has maintained its hard line on the Greeks.
Portuguese credit default swaps hit 1,000 basis points, at a level similar to Venezuela and Ireland, but way less than Greece’s 2,200 basis points.
Later in the day a Spanish bond offer went off well, calming markets somewhat.
This, along with good US jobs data, helped push the Dow up to a 3 month high and back to levels previously seen in May 2008. There were also good Aussie jobs numbers yesterday, better than expected.
This pushed their currency higher, and ours along with it. In fact, this morning we are at a one year high against the Yen, almost at a record versus the US dollar, and an all-time record against the beleaguered British pound at NZ$1 = UKP0.5210 The NZ dollar on a TWI basis is at its highest level since March 2008.
And finally, there has been stunning news out of the UK where Rupert Murdoch's News Corporation has announced it-s closing the huge “News of the World” operation because of the phone hacking scandal. Its rival The Guardian has led the attack. It may have been sacrificed to protect its planned full takeover of pay television group BSkyB. But it also may re-emerge as the Sun on Sunday.
Bernard Hickey is back on Monday.
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