* US stock markets sold-down overnight, as traders worried that this week’s European Union summit will fail to contain the sovereign debt crisis.
* European stock markets plunged overnight. Trader sentiment was down on the back of concerns that the EU summit will not be able to resolve the eurozone debt crisis.
* Asian stock markets slid again yesterday.
* Commodities prices generally lower, Gold prices are trading up around $US1,588 while crude-oil closed down around $US79.
The Australian market is expected to trade lower today, as traders take their lead from overseas, as the European Leaders prepare for their EU Leaders summit and at home traders clean out their portfolios for the new year. Markets traded sharplly lower in Europe and easing in the US markets. The Australian dollar remains just above parity overnight.
The SPI Futures is trading below the key pivot level of 4000, ended down -0.8% (or 34 points) at 3,963. The key levels for our index today are 3900 to 4000.
See below for ASX listed companies in the news today.
U.S. Markets
US stock markets sold-down overnight, as traders worried that this week’s European Union summit will fail to contain the sovereign debt crisis.
The Dow Jones Industrial Average fell over -1%, while in the broader market the S&P 500 slid -1.6%, in broad-based selling as 470 of its 500 stocks finished in the red. Technology and financial sectors led the sell-off, as all 10 of the S&P sectors fell, however the defensive sectors such as utilities performed fared relatively better.
Traders pressed the sell button as equities slumped on reports that Chancellor Angela Merkel has hardened her resistance to eurozone debt sharing, setting Germany at odds with its European counterparts at the summit on 28-29 June.
Investors are also facing a decline in American corporate earnings for the first time since 2009. Commodities prices continued to weigh on markets, but grains did see some support.
All ten company groups that make up the S&P index traded lower, with Materials down -1.3%, Energy sector was down -2.2%, Financials sector down -2.1%, Industrials sector was down -1.9%, Health Care down -11.2%, Technology was down -2.1%, while Consumer Staples were down -1.6%.
The Dow Jones closed down -1.1% (or -138 points) at 12,640, the S&P 500 index down -1.6% (or -21 points) at 1,314, the Nasdaq ended down -1.9% (or -56 points) at 2,836 and the smaller cap Russell 2000 was up 1.3%.
European Markets
European stock markets plunged overnight. The Stoxx Europe 600 index fell -1.5%, its worst daily performance since early June.
Across the region the banks were the major decliners suffering loses of over -4%. Spanish bond yields surged, as investors gave up on expectations that the European Union summit later this week will be above to come to an agreement to reolve the worsening eurozne crisis.
Spain made a formal request for EU aid to bailout its banks and in Greece’s the new finance minister resigned, after suffered stomach problems that led him to be hospitalised. Meanwhile, the prime minister is recovering from eye surgery and will not be able to attend the European Union summit later this week.
The Spanish market slumped -3.5% while in Greece the market plummeted nearl -7%. The German market recorded its worst single day drop in over a month.
In London the FTSE 100 index closed down -1.1% (or -105 points) at 5,450, the German DAX was closed down -2.1% (or -131 points) at 6,132, while in France the CAC was closed down -2.2% (or -69 points) at 3,021, Spain closed down -3.7% and Italy closed down -4.2%. Greece down -6.7% trimming gains since the start of June to 18%.
Asian Markets
Asian stock markets slid again yesterday. Trader sentiment was down on the back of concerns that the EU summit will not be able to resolve the eurozone debt crisis.
Across the region growth-sensitive stocks led the falls, with mining and energy stocks selling off again. Markets in China and South Korean led Asian markets lower. In China the Shanghai Composite Index dropped -1.6% compounding a its 4-session losing streak as the markets there reopened after a long weekend. Locally the selling is compounding on the last week for tax-loss selling for the financial year.
In China the SSE Composite closed down -1.7% (or -38 points) aat 2,224, while in Hong Kong the Hang Seng Index closed down -0.5% (or -98 points) at 18,987 and in Japan the Nikkei 225 Index was down -0.7% (or -55 points) at 8,734, South Korean KOSPI closed down -1.2% for the session, while the Indian market closed down -0.5%.
Commodities
The Dollar Index was higher at 82.46 on a lower Euro, while the Australian Dollar last traded lower at 1.0007. Commodities prices traded lower.
For the session the Benchmark crude NYMEX for June delivery was down -0.6% settled at $US79.21. Copper prices are looking for key support level as Copper for July delivery was up 0.3% (or 1 cents) at $US3.3255, while July Gold was up 3.2% (or $US21.50) at $US1,588.40.
BBG – Billabong the surf wear retailer, wiped out a thrid of its equity value, as investors baulked at a $225 million capital raising and a big earnings downgrade.
BXB- Brambles has appointed its new chief financial officer, Zlatko Todorcevski.
CMJ – Consolidated Media Holdings (ConsMedia) is in play a billionaire Kerry Stokes’ positioning for a possible bid
GFF – Goodman Fielder the breads and spreads supplier will cur 115 jobs from its Australian baking business as as a result of the closure of three bakeries.
LLC – Lend Lease says work has been halted for a second time at Sydney’s Barangaroo high-rise development because of fears about asbestos.
NHF – NiB the private health insurer, says its full year profit will come in at the lower end of its previous forecasts.
PPT – Perpetual the fund manager has forecast a massive full year profit slide and pay cuts for its board as it begins a major restructure.
TPI – Transpacific Industries the waste disposal company has downgraded its full year profit forecast partly due to lower garbage volumes in Queensland.
WPL – Woodside awaits Western Australia’s environmental watchdog announcement on its decision on Woodside Petroleum’s controversial James Price Point gas hub project on Friday.
Corporate News
Ex-dividend Date
Aneka Tambang (ATM)
Market Summary
ASX – to open lower
US & UK/Europe – sharply lower
Commodities Stock Index down -1.4%
Gold Stocks Index down -0.9%
Oil Stocks Index down -2.2%
US ADRs – Broadly Lower!!…
BHP down -3.2%, RIO down -3.9%; AWC down -4.8%
ANZ down -1.6% & NAB down -1.5%
NEM up 1.7%, JHX up 0.2%, NWS down -1.4%
By Michael Hevern
Head of Research
Tags: Asian Markets, ASX, ASX News, Business News, Commodities, Crude Oil, European Markets, Ex Dividend, gold price, Nasdaq, Stock Market Analysis, stockmarket, trading, US Market wrap
