New Overnight Developments Abroad: Higher Risk Aversion Sends Stocks Lower and Dollar Up

May 14, 2009

The dollar climbed 0.5% against the Australian dollar, 0.4% relative to sterling, 0.3% against the euro, 0.2% versus the Swissy and kiwi, and 0.1% against the Canadian dollar.  The yen is steady, moving up in tandem with the dollar.

Japan’s Nikkei fell 2.6%. Elsewhere in the Pacific Rim, stocks fell 3.4% in Australia, 3.0% in Hong Kong, 1.3% in New Zealand, 2.8% in South Korea, 3.6% in Indonesia, 1.2% in India, 1.1% in Malaysia, 1.9% in Taiwan, and 4.7% in Thailand.  In Europe, the German Dax and Paris Cac are 0.5% and 0.3% lower.

Gilt, bund, and JGB ten-year yields have moved down.

Oil fell by 1.8% to $57.00/barrel.  Gold edged 0.3% lower to $922.90/ounce.

Spanish real GDP fell 1.8% last quarter, nearly twice as much as in 4Q08, and on-year negative growth swelled to 2.9% from 0.7%.  The results were in line with analyst expectations.

The ECB conducted a survey of forecasters, who now look for Euroland GDP to drop 3.4% this year and only recover 0.2% in 2010.

Swiss producer prices were unchanged in April, while import prices fell by 0.5% and 7.6% from April 2008.  The combined PPI/import price index slid 0.2% and by 3.6% from a year earlier.  Its 12-month change had been -2.8% in March but +3.6% in April 2008.

Dutch consumer price inflation slowed to 1.8% in April from 2.0% in March.  Finnish CPI inflation edged down a tenth to 0.8%.  Russian producer prices fell 4.1% in the year to April.

Industrial output in Hungary fell 15.6% in the year to March.

U.S. jobless claims and producer prices will be released at 12:30 GMT.  A Turkish central bank rate cut is likely today.

Copyright 2009 Larry Greenberg.  All rights reserved.  No secondary distribution without express permission.

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