European concerns weigh down on Asian markets

Asian stocks were again lower with traders unable to shrug off European debt concerns ahead of an upcoming summit.

Japan’s outbound shipments grew by 7.9% compared to the same period last year for the month of April but, given last year’s disruptions, the number was below estimates of around 12%.

The trade deficit widened to $6.5bn, again slightly larger than market expectations.

The US dollar yen pair was last trading at its intraday low of 79.46 despite the print and renewed speculation that the Bank of Japan is ready to undertake some significant and large intervention policies.

The MSCI Asia Pacific index was last trading 2% lower – a significant fall with losses across the board. Australia’s ASX200 index fared slightly better, down by only 1.25% at its close.

The Australian dollar last traded at 97.68 US cents with gold again sluggish at US$1558/oz and copper pointing to losses, last at US$3.44/lb.

All eyes are on Europe ahead of tonight’s summit. The euro dollar was last buying 126.71, weighed down by former Greek Prime Minister’s comments highlighting a real risk that the country could in fact leave the economic bloc.

Tonight’s meeting Asian time marks the 18th crisis meeting since the financial crisis emerged.

Germany looks ever more isolated as Chancellor Angela Merkel, the dominant figure in more than two years of crisis-fighting, heads to the Brussels summit. She remains unable to stifle calls for measures she opposes, including common European bonds, the use of European money to recapitalise banks, a bigger rescue fund and extra time for debt-burdened countries to cut spending.