Bernard Hickey details the key news overnight in 90 seconds at 9 am in association with Bank of New Zealand, including news that fears about Europe's ability to solve its sovereign debt crisis returned to markets overnight.
Divisions emerged in how to expand the size of the writedowns on Greek debt with the European Commission opposing a plan to increase the writedowns for banks holding Greek debt.
Markets are also watching significant opposition to the so-called 'Bazooka' plan for a mega-bailout fund within Germany.
US stocks were closomg down around 0.8% and European stocks closed down 1% as Tuesday night's rally petered out quickly. See more from Bloomberg.
UPDATE - A late selloff saw the Dow close down 1.6% and the S&P 500 close down 2%.
Bans on short-selling of Italian and Spanish financial stocks were also extended, reinforcing the fragility of the European markets and bank stocks in particular. See more here from Bloomberg.
Markets are watching a key vote in the German parliament on an old expansion of the Greek bailout fund on Thursday night. Although it is expected to pass, Chancellor Angela Merkel may be weakened politically if she has to call on opposition votes for support. Some are even talking about the calling of new elections.
Also, concerns are growing about the fallout on Chinese industrial production and demand for commodities. Bank of America released a research report warning of a 'hard landing' in China. See more here at Zerohedge on that report.
Commodity prices, which are most sensitive to perceptions about growth in China, are slumping. Copper fell a further 7.6% overnight and Gold also fell a further 1.3%. See more here at Bloomberg.
Oil prices fell 3.8%. Even Coffee prices fell. See more here at Bloomberg.
All of this weakness in the global economic outlook and in commodity prices dragged the New Zealand dollar down.
It fell to 77.7 USc in early trade from over 78 USc
(Updated with US closes)
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