Asian markets seem set to trade lower after big falls in US and Europe overnight
City Index March 8, 2012 3:40 AM
<p>Global stocks continued to decline in what started as an Asian surprise on Monday when China reduced its growth targets. The S&P500 continued its worst […]</p>
Global stocks continued to decline in what started as an Asian surprise on Monday when China reduced its growth targets.
The S&P500 continued its worst decline for the year, down around 1.5%. Losses were widespread. All 10 groups in the S&P 500 fell as financial, industrial and commodity shares had the biggest losses.
Markets in Europe performed even worse, with the Stoxx 50 down 3.4%, the Dax down 3.4% and the FTSE100 down 1.9%.
Currencies also took a tumble with the Australian dollar last buying 1.0553 against the US dollar, back to its 50 day moving average. The Euro declined to 1.3314 against the US dollar. The Japanese Yen rose against the US dollar which last bought 80.90, back below the 81 level.
In commodities, gold continued to show its vulnerabilities, falling back below US$1700/oz to last settle at US$1674. Silver booked similar losses, last trading at US$32.90/oz.
The gold to silver ratio is now back above 50x, last at around 50.9x. Copper took the largest loss, down 3.2% to last settle at around US$3.73/lb. Should the market selloff continue, it could come back to settle within the US$3.60-65 price range.
Asian equities are expected to continue to fall today. A measure of the top 55 Chinese stocks on the US market fell by around 2.5% in early afternoon New York trading. Stocks like China Life Insurance tumbled to trade at its biggest discount to its Hong Kong listing in seven months.
No doubt, the market is looking for the earliest possible signs of Chinese monetary easing ahead of the all important inflation numbers on Friday.
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