* US stock markets end at 3-month lows on concerns over global financial stability, after JP Morgans trading loss and talk of Greece leaving the EU.
* European stocks sold-off overnight, as traders were spooked by news out of Greece that may trigger a disorderly default.
* Asian stocks ended generally lower yesterday, as investors were cautious over the prospects of a slowing China and the problems with the geopolitics in the eurozone.
* Commodities prices were sharply lower, with Gold prices traded around $US1,558 while crude-oil closed around $US94.
The Australian market is expected to sell-off again today. Markets traded lower from the open and finished close to their session lows in the European markets and in the US. Traders have hit the sell button on concerns over Greece, China and the US Financials.
The SPI Futures is trading below the key pivot level of 4300, ended down -0.7% (or-31 points) at 4,266. The key levels for our index today are 4220 to 4300.
See below for ASX listed companies in the news today.
US stock markets end at 3-month lows on concerns over global financial stability, after JP Morgans trading loss and talk of Greece leaving the EU.
Traders are facing a storm of negative news with concerns about Greece possibly exiting from the eurozone, as a result of the worsening political upheaval in the eurozone and worries that the Chinese economy may be softening more than previously thought, while domestically the news of the JP Morgan trading loss is cast a shadow over the recovery of the financials in the US economy. The Dow Jones Industrial Average closed down for an eighth time in nine sessions and had it lowest close since January. In the broader markets the S&P500 fell for a fourth session in the past five and the Nasdaq fell over 1% for the session. All 10 of the S&P 500′s sectors fell, as financials, materials and energy sectors the biggest drags.
In corporate news, JP Morgan Chase lost another -3.2%, as the company has shed nearly $US20 billion in market cap over its two-session pummelling, as the leader of JPMorgan’s hedging unit is retiring, marking the first casualty from stunning $US2 billion trading loss that experts say could exceed $US3 billion by year’s end. Chesapeake Energy the natural-gas company jumped 4.8% after The Wall Street Journal reported activist investor Carl Icahn will soon disclose a significant stake in the company, while Yahoo rose 2% after the company said Chief Executive Scott Thompson will resign in the wake of controversy over his academic record. Facebook is on track for listing on Friday and is expected to create over 1000 millionaires overnight. Commodities have been a major drag in the recent market pullback as Gold is down -12.7$, Crude-oil down -14.2% and Copper down -10.5%.
All ten company groups that make up the S&P index traded lower, except for Technology, with the Materials down -1.4% , Energy sector was down -1.7%, Financials sector down -2.1%, Industrials sector was down -1.2%, Technology was down -0.9%, while Consumer Staples were down -1.4%.
The Dow Jones closed down -1.0% (or -125 points) at 12,695, the S&P 500 index down -1.1% (or -15 points) at 1,338, the Nasdaq ended down -1.1% (or -31 points) at 2,934 and the smaller cap Russell 2000 was down -1.4%.
European stocks sold-off overnight, as traders were spooked by news out of Greece that may trigger a disorderly default going forward, as leaders discuss openly that Greece may leave the EU. The Stoxx Europe 600 index fell -1.8%.
Traders hit the sell button from the outset, with markets closing close to their lows for the session. Across the region the falls have been led by the financials, mining and energy sectors as investors sought “Risk Off”.
Greece is no closer to forming a coalition government and there is even talk that that country may have to leave the EU, which would trigger a disorderly default and all sorts of problem with the eurozone financial system. The Greek market has plunged -4.6%. Bond yields for the PIIGS countries soared overrnight according to FactSet Research,the yield on Spain’s 10-year government bond soared 22 basis points to well above 6%, while Italian 10-year government bond yield rose 25 basis points to 5.68%, conversely Germany yields are at neared record lows as investors sought to park funds in these safe-haven bonds.
In London the FTSE 100 index last closed down -2.0% (or -110 points) at 5,465, the German DAX was closed down -1.9% (or -128 points) at 6,452 while in France the CAC was closed down -2.3% (or -72 points) at 3,057, Spain closed down -2.7% and Italy closed down -2.7%.
In China the SSE Composite closed down -0.6% (or -15 points) at 2,380, while in Hong Kong the Hang Seng Index closed down -1.2% (or -229 points) at 19,735 and in Japan the Nikkei 225 Index was up 0.2% (or 20 points) at 8,973, South Korean KOSPI was down -0.2% for the session, while the Indian market closed down -0.5%.
The Dollar Index was higher at 80.70 on a lower Euro, while the Australian Dollar last traded lower at 99.71. Commodities prices traded sharply lower.
IPL – Incitec Pivot the explosives and fertiliser producer says first half profit has dropped by 13 percent due to significantly lower earnings from fertilisers.
LLC – Lend Lease and a Leighton Holdings subsidiary have been awarded work on Victoria’s regional rail link.
NAB – National Australia Bank (NAB) chief executive Cameron Clyne says he expects the central bank to deliver more interest rate cuts.
PDN – Paladin Energy the Africa-focused uranium miner says production at its mine in Malawi has been stalled after local workers walked off the job.
RIO – Rio Tinto has flagged cutting some of its multi-billion dollar Australian expansion projects due to soaring costs.
STO – Santos Chief says changes to Australia’s fiscal and regulatory regimes give global makes investors nervous.
Whitefield Ltd (WHF)
ASX – to open lower
US & UK/Europe – sharply lower
BHP down -1.9%, RIO down -1.8%; AWC down -5.9%
ANZ down -0.9% & NAB down -0.7%
NEM down -1.5%, JHX up 0.1%, NWS down -0.5%
By Michael Hevern