Bernard Hickey details the key news overnight in 90 seconds at 9 am in association with Bank of New Zealand, including news that European and Australian stocks fell sharply again overnight on fears that Greece is about to default on its sovereign debt.
European stocks fell more than 3%, with France's CAC falling 4% and the Europe-wide DJStoxx 50 index down 3.8%. Australian stocks fell 3.7% yesterday and the Australian dollar was weak overnight, given it has proved something of a bellwether for risk in the global economy.
Greece announced plans for an emergency and temporary property tax of 10 euros per square meter to be paid with power bills as it desperately tries to fend off default. Greece is expected to run out of money by October if it cannot win the agreement of Germany to a fresh bailout payment.
Germany's Finance Minister warned last week Germany may block the payout given it lacks confidence about Greece's ability to dig itself out from under the debt. Greece's economy contracted 7% in the first quarter from a year ago and a 'troika' team of inspectors left Greece in a hurry last week because they doubted Greece could meet its deficit and growth targets. See more here at The Telegraph.
However, US stocks rallied more than 2% in the last two hours of trade after an FT report that Italy had won assurances from a big Chinese investor that it would buy Italian government bonds. The Dow rose 230 points from its lows in the last two hours of trade to close up 56 points or 0.5%. See more here at Bloomberg.
Meanwhile, French stocks took a hammering. Societe Generale announced it would free up 4 billion euros through asset sales and job cuts. It has 900 million euros of Greek bonds and up to 4.3 billion euros worth of Italian and PIGS bonds. Its shares have fallen 60% this year and closed down another 8% overnight. See more here at Bloomberg on Societe Generale's plan.
Also, Bank of America announced 30,000 job losses to cut US$5 billion of costs, but investors who have slashed its shares by 50% this year and expect Bank of America will have to raise US$50 billion in capital in coming years were underwhelmed. See more here at Reuters.
In Britain, the government has announced the ringfencing of customer deposits and small business lending from investment banking in a move designed to reduce the risks of investment banking blowups spreading to the 'real economy'. The move is expected to cost banks 7 billion pounds. See more here at The Telegraph.
The New Zealand dollar remained firm just over 82.2 USc, but was stronger against a weak Australian dollar at around 80 Australian cents. See more here at Bloomberg on the weak Australian dollar.
(Updated with links)
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20 Comments
Zerohedge thinks the Chinese/Italian rumours are so much BS:
http://www.zerohedge.com/news/reminder-here-what-china-really-thinks-ab…
I tend to agree - I imagine a semi-audible denial from the Chinese in the next few days.
I was one that expressed concerns re inflated visitor numbers, mainly due to the non rugby type visitors staying away. John Key is now saying 100,000 RWC tourists, well up on the 65,000 prior estimate - don't know where he gets that figure from but he is prone to exageration.
We usually get 2.2 million or so visitors a year, or an average of 350,000 over two months. Be interesting to see if there is any net gain in tourists due to the RWC.
That aside it's a great spectical and a credit to the organisers and volounteers. The AB's back line are outstanding, good luck to them all.
Pain in the UK to last a decade (and the rest)
http://uk.finance.yahoo.com/news/Pain-British-slump-last-afp-2953682705…
Four horsemen
http://www.fourhorsemenfilm.com/
the cost to Ireland http://www.independent.ie/business/european/euro-exit-could-cost-euro45000-for-each-family-2873059.htmlNobody trusts anyone any more. This is where the constant stream of BS has taken the world. The banks all over the world are either utterly fecken broke or they are scared stiff of lending credit to other banks because the lying corrupt and fraudulent farce that hides the truth about the filth owned by banks...means they have no idea of what is safe and what is sick.
Meanwhile the paper money is turning to used toilet paper quicker than you can blink. Here in Noddyland there is a determination to debase as fast as can be without silly peasant waking up to the great rort going on. Thankyou Alan Bollard and Bill "inflation is good" English.
Quick before anyone sees the scam...drop the ocr and make the credit even cheaper...heaps more debt will surely solve a crisis of too much debt.....
I do not own any bank shares and I would not buy any in this dive to the bottom. They are all lying about their risk status because they have no idea of the security over their loans..not here and certainly not in aus. The truth is...in this new normal market, which is set to remain in place for decades to come, the need is for only two maybe three banks, with a serious bunch of regulatory bastards in charge at the RBNZ.....aiming to keep inflation near to zero and aiming to prevent any bank from gaining a position that gives it the opening to 'farm' the nz economy....and that is exactly what the bastards are doing right now with the full support of the RBNZ and the fools in the Beehive....
The utter idiocy and uselessness of all NZ govts to date...has handed this economy over to the bank credit creation rort.
Forget about judging the economy with some GDP data farce...just make public bank profits before their minimal taxes and we will have all we need to know.
"Low-income families with children will be able to almost double their weekly tax credits if they move to Australia by 2018, an analysis has found." herald
Great news...away you go...enjoy the flight!
Has nobody heard of family planning...do none of them know that a child costs heaps...that many cost multiple heaps...is this some sort of mass idiocy in this society.
Why should adults who keep to having just two children by using the normal family planning options open to them, have to pay out their income to subsidise the low income lot who have too many to pay for.......what the hell is going on here.....Labour think it is fabulous for low income families to pop sprogs out like sausages from a machine....because others will pay for them.
"One person was killed and four injured in a blast at a nuclear site in the south of France overnight as the government sought to play down fears of a radioactive leak.
There was "no cause for concern'', Environment Minister Nathalie Kosciuscko-Morizet said at the scene of the explosion at Codolet in the Rhone Valley, near the southern city of Nimes.
"None of the detectors on site, both inside and outside, have detective any radioactive leak,'' she said after meeting family members of the victims, adding the cause of the blast was not yet known.
France's state nuclear regulator had earlier warned there was a risk of a leak."
Safe as a French state bank. French nuclear reactors use a special French type of Plutonium fuel rod which can never leak...because the politicians have said so.
Will you be off to Nimes for your hols?
FYI
http://www.stuff.co.nz/national/politics/5616905/Government-seizes-control-of-Auckland-waterfront
The Government will use special powers under Rugby World Cup legislation to take control of the Auckland waterfront set aside for the celebrations during the tournament.
Rugby World Cup Minister Murray McCully will this afternoon outline his intention to tomorrow call up reserve powers available to him under the Rugby World Cup Empowerment Bill.
It has been revealed, ahead of the announcement, that McCully has ordered Government officials to write a new plan to manage the waterfront beyond its own Fan Zone at Queen's Wharf.
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