Here's my summary of the key news overnight in 90 seconds at 9 am, including news US stocks fell sharply on Friday night and again in early trading overnight as worries mounted over corporate earnings.
US stocks have rallied 15% to near five year highs this year on hopes US and European monetary stimulus would boost global activity. Now investors are looking at the evidence of whether all the stimulus is boosting activity in the real economy and in corporate profits.
However, there have been weak results in recent days from the likes of Google, Microsoft, General Electric and McDonalds. US stocks were down 0.5% in late trade and fell more than 1.5% on Friday night. They eventually closed flat after a late rally. See more here at Bloomberg.
The New Zealand dollar, which often rises and falls with appetites for riskier assets globally, fell to 81.6 USc by this morning, having reached over 82.2 USc on Friday. See more here in Mike Jones currencies report on our site.
Meanwhile, investors in New Zealand are looking ahead to Thursday morning at 9 am when new Reserve Bank Governor Graeme Wheeler announces his first decision on the Official Cash Rate.
Markets are pricing in a 15% chance of a cut in the OCR, but all economists expect Wheeler to hold the rate at 2.5%.
Most economists do not expect the OCR to rise until late next year as the inflation-sapping effects of slow growth globally and a high New Zealand dollar keep inflation expectations well within the Reserve Bank's 1-3% target band. See Alex Tarrant's preview here.
Meanwhile, Hong Kong was forced over the weekend to defend its peg to the US dollar as some speculate it will pushed up beyond its target range. The Hong Kong Monetary Authority (HKMA) bought US$600 million worth of US dollars to try to stop it from rising. A hedge fund manager called William Ackman from Pershing Square is betting the Hong Kong dollar will be forced off the peg. See more here at Bloomberg.
Elsewhere in another sign of slowing growth in Asia, Japan reported exports fell 10% in September from a year ago as demand from Europe and the United States was weak and Japan's territorial dispute with China hit sales of Japanese made cars and electronics in China. See more here at Bloomberg.
(Updated with late rally in stocks to close flat)
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14 Comments
Here is an interesting link that came to my attention over the weekend via Iain Parker.
In 1807, February 9, Napoleon issued a rabbinical Fatwa prohibiting usury (the charging of interest). Upon being shown a table of interest charges, he reflected for a while and made the following comment:
"The deadly facts herein revealed,
lead me to wonder that this monster, interest, has not devoured the whole human race. It would have done so long ago if bankruptcy and revolutions had not acted as counter poisons. " http://www.progress.org/2010/napoleon.htmIsnt history fasinating. The more I read the more I realise we just keep repeating the same mistakes that previous generations made, repeatedly.
This is of course sad....it means that no matter what information, logic and correctness you have on the situation, we will somehow pick the wrong path.
great......just....great...
:/
regards
Not forgetting most of the time History transcribed, is a somewhat geared revision of events to influence future directions to repeat behaviours....sanitise inconvenient facts.......mask alterior motives.....cosolidate the mindset of the masses in order they be controlled more easily.
The current campaign to steer pre 1987 stock investors to return to the markets by fair means or foul is just one such classic demonstration....it's happening right here right now.
http://krugman.blogs.nytimes.com/2012/10/22/things-that-arent-bubbles/
Oooops , stocks rose ..... YIKES ! ..... the DOW rallied in late trade ( reversing an 83 point mid-afternoon fall ) , to close 2 points up ( the NASDQ rose 0.38 % on the day , 11 points to the good ) ...
... after the market close Yahoo announced an increase in third quarter profits and revenue , pipping analysts predictions ....
David Katz ( Weiser Mazers Wealth Advisors NY ) described third quarter revenue results across the broader market as fair , and said that the US economy is slow and steady ," it is a snail's pace , but it's certainly better than what we had . "
..... might have to change that headline Bernard , " Stocks fall 1.5 % on Friday , steady as she goes on Monday " ...... cheers !
Many thanks Gummy. Sorry it's taken me so long to respond.
I have updated now. It should have been much earlier. We find daylight saving and 90 at 9 a difficult mix.
We have to record the video around 8.15, hence the phrasing of 'in late trade'. But I should have revisited and updated.
cheers
Bernard
Yes, wasnt this just proved (via GBH's comment?)
I'd say it was the advantage to a consumer is the freedom to research, anything, anytime, anywhere in as much detail as needed, with the latest info, to be informed...
A net blog is like a WOF, its a point in time....so Friday it was down, today its corrected......
regards
The 'Dow' is a bunch of ignorant lemmings, rushing to the high-side every time the ship rolls. They have no idea, jointly or severally, of what is really happening, and no real event would ever change it 2%, or even 1/2% in a day. Only panicky gamblers can create swings like that in such a wide game.
And you only get panicky gamblers when?
There's no other game in town,
"There's no other game in town" there is of course, but the financial lemmings cant see that, too busy "making money" for themselves. And if they lose its the Govn's fault and not theirs, so the Govn had better bail them out and with a profit margin. Meanwhile they whine about the deadbeats on welfare...
"let them eat cake" springs to mind....
/me sits back and waits for "shoot the messenger" comments.
regards
Apart from AEP's article (which has generated an enormous comments thread), there's this little vignette from Jeff Randall.
Now substitute NZ for Cyrus, and tell us all just how our 'PR if'n yer pockets are full enough' differs from that of the now cash-strapped Cypriots. And the Laundromat barb.
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