This was published 13 years ago
Markets Live: Shares stuck in Euro gloom
Australian stocks fell for a third day after early bargain hunting gave way to worries about Europe's raging debt crisis and weak global growth.
5.14pm: That's all for today here at blog central. We'll be back Monday morning, 9.30am.
Thanks for reading this blog and posting your comments. Have a geat, and hopefully dry, weekend.
Here's our evening wrap of today's session.
4.53pm: Australian bond futures prices have fallen and yields rose as traders stuck to the sidelines waiting for further developments in Europe’s debt crisis.
The June 10-year bond futures contract was trading at 96.890 (implying a yield of 3.110 per cent), down from 96.915 (3.085 per cent) on Thursday. The June three-year bond futures contract was at 97.600 (2.400 per cent), down from 97.630 (2.370 per cent).
Commonwealth Bank interest rate strategist Phillip Brown said that with no major economic data expected, the market spent Friday cooling its heels ahead of the European session on Friday night.
‘‘It was actually a pretty quiet day to be honest. We’re just waiting to see what direction Europe takes us,’’ he said.
Mr Brown said developments in Europe, which was facing the possibility Greece could exit the eurozone, would continue to dominate markets movements next week. He said traders would next week begin to focus more on the Reserve Bank of Australia’s (RBA) June 5 board meeting when another interest rate cut was possible.
4.37pm: The Australian dollar, meanwhile, is at 97.54 US cents, hovering near six-month lows, as early bargain-hunting gave way to renewed selling amid persistent worries about Europe's raging debt crisis and weak global growth.
"(The negativity) looks a bit overdone and we could see a move higher, perhaps towards parity," says Greg Gibbs, a strategist at Royal Bank of Scotland.
In the longer-term, he sees the Aussie climbing back to $1.0500 by year-end, believing that a rebound in Chinese growth would spur demand for the commodity currency.
4.24pm: The ASX200 also fell 0.4 per cent over the week, posting its third consecutive week of losses.
May has been a particularly gloomy month for the local market: the ASX200 has dropped 8.6 per cent since the beginning of the month. This week's loss shaved the last bit of 2012 gains off the index, which is now down 0.7 per cent since the start of the year.
And in a last statistic on the extent of damage done since the Greek debt crisis started shaking investor confidence: the ASX200 hit its peak for this year at 4435.9 on May 2. Since then it's been mainly downhill: 9.2 per cent, which is just short of what traders deem a correction - a 10 per cent fall.
Here's a chart showing how the ASX200 fell off a cliff early May after a fairly steady April:
4.17pm: Among the major sectors, materials dropped 0.8 per cent, financials and energy both fell 0.6 per cent.
Defensive utilities were one of the few sectors to post a gain, rising 0.7 per cent.
4.13pm: The market has closed lower, falling for a third straight day. The benchmark S&P/ASX200 index dropped 26.6 points, or 0.7 per cent, to 4029.2, while the broader All Ords shed 25 points, or 0.6 per cent, to 4081.2.
4.01pm: Union leaders have lashed out at a federal government skilled migration plan that will allow mining magnate Gina Rinehart to bring in 1700 foreign workers, saying it is a kick in the guts for Australian employees.
Australian Council of Trade Unions leader Dave Oliver said it was ‘‘reprehensible’’ and Australian workers were being overlooked. ‘‘We are calling on the prime minister to immediately intervene to ensure before any workers are being brought in under the 457 visa program that there has been appropriate measures in place to ensure that the local market has been tested,’’ he told reporters.
Australian Workers’ Union head Paul Howes said it beggared belief that the announcement was made in the wake of recent jobs losses at Qantas and the Norsk Hydro aluminium smelter in NSW.
‘‘On Friday we come to Canberra to meet with the prime minister, the industry minister and the CEOs of the major manufacturing industries to address the 130,000 jobs that have been lost out of manufacturing since 2008,’’ a clearly angry Mr Howes told reporters. ‘‘And Chris Bowen is announcing that Gina Rinehart gets an early Christmas present.
‘‘I thought we were actually attacking these guys at the moment. Whose side are we on?’’
3.55pm: The Australian sharemarket started off the day with good intentions, however the familiar theme of grief-over-Greece swept the index into negative territory in afternoon trade, says CMC Markets trader Tim Waterer.
- The difference of opinion among EU leaders has a ‘too many cooks spoil the broth’ appearance which is acting as one gigantic constraint on financial markets at present.
- With traders still on high-alert status over the global growth picture, our mining and energy stocks in particular remain a source of fragility for the local index.
- Currency market flows are still heavily slanted the way of the low yielding greenback, while the euro is left to flounder with so many unenviable outcomes possible in relation to Greece.
- With traders on tenterhooks over growth prospects, the oil price will be subject to further downside risks in the lead up to the Greek elections
3.46pm: Some more on Europe, which is likely to keep markets on edge for the next couple of weeks: some of the Nordic region’s largest banks, among the best rated in Europe, have been downgraded by Moody’s on concern that a reliance on wholesale funding has left them vulnerable to market volatility.
Sweden’s Nordea Bank and Svenska Handelsbanken were cut by one level to Aa3 and Norway’s DNB Bank ASA was lowered to A1, Moody’s said in separate statements.
Credit grades of SEB AB and Swedbank AB were affirmed while Landshypotek AB was cut two steps to Baa2. All are now at stable outlooks.
‘Moody’s recognises that the Swedish economy has so far performed well compared with other European Union economies, and Swedish banks have been able to attract market funding on economic terms from international investors,’’ it said. ‘‘Furthermore, Swedish banks have strengthened their capitalization since 2008.’’
3.40pm: Couple of key prices:
Spot gold continues to hover at about $US1554 an ounce, while New York oil futures are flat at about $US90.50.
3.34pm: The ASX200 is heading down again, and may close at or near its low for the day.
At its current level (say 4030), it's off 0.4 per cent for the week, and would make its lowest close since November 25 should that be the final number.
3.25pm: Mmm...might be getting ahead of ourselves with that last (now corrected) timestamp.
Anyway, here's an interest read on Facebook by Motley Fool's Morgan Housel - on why Facebook investors have only themselves to blame. Among the key points:
A satirical Twitter account for Goldman Sachs employees reminds us of a big one: "Retail investors should be circumspect of any offering they're able to get their hands on. If you can get it, you don't want it."
Wall Street doesn't have small investors' best interest at heart. That should be excruciatingly clear after all these years.
Most companies don't go public because they want to let you in on the action. They do so to let insiders cash out richly priced shares onto unsuspecting gulls. You're only a victim of that as much as you're willing to let yourself be.
3.15pm: FTSE100 futures are down about 0.5 per cent, indicating a softer start of trade in London. Wall Street index futures are also down but only by about 0.25 per cent.
3.12pm: And in other news out of Europe, as the region awakes to what be another shaky day on the markets, the Guardian is reporting police are urging Greeks to keep their money in bank accounts rather than putting it at risk of theft.
Greece's banks are likely to be shored up today or Monday with 18 billion euros of bailout funds they have been due to receive for weeks but which were held up by political uncertainty caused by inconclusive elections. Greece goes to the polls again on June 17, further stoking fears about its future within the euro.
The scale of withdrawals from Greek banks – almost 25 per cent of deposits have been taken out in the past two years – and fears that other countries may suffer mass withdrawals has led to speculation that a eurozone-wide guarantee is needed to maintain confidence in the banking system.
Deposits in other eurozone countries are holding up, the Guardian says, with those in Spain and Italy down only 3% and 2% respectively.
3.05pm: Some of Europe’s biggest fund managers have confirmed they are dumping euro assets amid rising fears over a possible Greek exit from the eurozone and single currency turmoil, the FT reports today.
Amundi, Threadneedle Investments and Merk Investments are among the funds identified.
2.59pm: Warren Buffett, whose Berkshire Hathaway struck a deal this month to acquire 63 newspapers, says he may buy more publications as the industry rethinks whether to offer free content on the internet.
“This is an unsustainable model and certain of our papers are already making progress in moving to something that makes more sense,” Mr Buffett wrote in a letter to editors and publishers of Berkshire’s daily newspapers. “We want your best thinking as we work out the blend of digital and print that will attract both the audience and the revenue we need.”
2.45pm: China's annual export and import growth showed signs of acceleration in the first 10 days of May, but the country is still facing "a relatively stern trade environment," the commerce ministry says.
Chinese exports grew 27.3 per cent and imports rose 28 per cent in the first 10 days of May compared with the same period of last year, vice commerce minister Li Jinzao told a news conference.
"There are signs of things turning better from data in the first 10 days of May," Li said. "They are making us more confident about achieving this year's trade target.
"But we also clearly know that there will be no quick and significant improvement in global situation, and we are still confronted with a relatively stern trade environment," Li said.
2.23pm: "Markets have priced in a very negative scenario for Greece as well as deteriorating growth prospects in the eurozone, but with them very much focused on the tail risk of Greece leaving the euro bloc, the euro remains highly vulnerable," says Masafumi Yamamoto, chief FX strategist at Barclays.
A poll yesterday showed Greece's anti-bailout leftist Syriza party is maintaining its lead ahead of a June 17 election which may determine whether the country remains inside the common currency bloc.
2.16pm: But it's not only Japanese shares that are struggling today; most regional markets are in the red:
- Hong Kong: -0.3%
- Shanghai: -0.4%
- Taiwan: -0.5%
- South Korea: +0.3%
- Singapore: -0.45%
- New Zealand: -0.1%
2.05pm: The long slump.
As noted early, Japanese stocks are headed for their worst run of weekly losses in 20 years.
Worth reminding ourselves what the markets looked like back then.
The ASX200 hadn't debuted yet (1992), so to compare the Nikkei 225 against the All Ords since then, you'll see the striking divergence. (Nikkei is the 'white', All Ords 'green' in the Bloomberg chart.)
When Japan was seen as taking over the world's economic leadership in the late 1980's the index peaked at almost 39,000 yen (yes, that's how they count the points). Its peak came on December 29, 1989 - and it had almost halved 10 months later.
From 38,915 then, the Nikkei remains low - 22 years on - at about 8500 now. Over that time, the All Ords are up 255 per cent, by comparison.
1.53pm: Short of some major unscheduled event, we may see the ASX200 trade in a narrow band for the remaining two hours of the trading week. Most of the region is off about 0.5 per cent or thereabouts.
Dow futures are down about 0.3 per cent and London's FTSE futures is down about 0.5 per cent too.
1.40pm: Takeover target Eureka Energy has shrugged off criticism about its new $50 million debt facility after suitor Aurora Oil & Gas threatened to withdraw its offer.
Aurora says the debt facility is too costly and onerous and could be drawn down without shareholder approval.
Eureka is a US-focussed shale oil and gas explorer and producer and plans to use the money to meet funding requirements due soon to develop its flagship Sugarloaf project in Texas.
It says in a statement it wanted to set the record straight on Aurora’s claims about the facility struck with the Macquarie Bank.
‘‘It delivered certainty of funding, without which it would have been vulnerable,’’ Eureka says.
1.32pm: Asian shares have fallen to their lowest levels of the year as early bargain hunting gives way to worries about Europe's raging debt crisis and weak global growth.
The MSCI's broadest index of Asia-Pacific shares outside Japan is down 0.7 per cent, after edging up as much as 0.3 per cent earlier, hitting its lowest since late December as worries about a possible Greek exit from the euro zone continued to weigh on the market.
Japan's Nikkei stock average is flat, but looks set for its longest weekly losing run in 20 years.
1.25pm: A Leighton Holdings company will build two large-scale ‘‘energy-efficient’’ data centres in NSW under a $182 million contract with the state government.
Under the contract, Leighton subsidiary Metronode will build a data centre at Silverwater, in Sydney’s west, and another in the Wollongong suburb of Unanderra.
The contract has an initial 10-year term and will see more than 250 jobs created during the construction phase, Metronode says.
1.16pm: Easy Forex senior dealer Francisco Solar says manufacturing data from purchasing managers' index (PMI) surveys from Europe and China continue to dampen market optimism.
''It was quite a negative new event yesterday across the board,'' Mr Solar says.
''The market needed another excuse to push further down and yesterday we got that.''
Mr Solar says further evidence of an economic slowdown in China is weighing on the dollar.
''There is also talk of Chinese banks undershooting loan targets for the first time in seven years,'' he says.
''We got a very tight range today. It's not on positive sentiment, it's more on indecision. The bias is definitely on the down side.''
1.07pm: The dollar, meanwhile, is hovering at about 97.4 US cents. It's on course for its fourth weekly drop in a row - with would make it 10 of the past 12 weeks that it's lost ground against the greenback.
1.03pm: Among the top 50 stocks today:
Gainers:
News Corp 1.6%
Incitec Pivot 1.5%
Iluka 1%
Toll 0.7%
AMP 0.7%
Losers:
Fortescue 3.4%
Leighton 2.6%
Asciano 2%
Wesfarmers 1.9%
Worleyparsons 1.8%
12.58pm: And indeed, that level has been passed, modestly for now, with the ASX200 touching 4025.5 points - for a loss of 0.7 per cent on the day. We're now in lowest-in-seven-months territory.
12.54pm: ASX200 slumped to 4026.6 points a few minutes ago - a whisker above the intraday low of 4026.5 points touched during last Friday's slide.
Should it drop below that latter level, it will be at levels not seen since October 6 last year. (Mind you, the closing totals may not be quickly as low.)
12.45pm: Hope you're enjoying the free coverage. Billionaire Warren Buffett reckons free online news is unsustainable - hence his decision to start buying up 63 newspapers in the US.
Mind you, most of those are very local papers. (The East Sydney Morning Herald and The South-eastern Age doesn't quite have the same ring.) Anyway, here's more from Mr Buffett:
“This is an unsustainable model and certain of our papers are already making progress in moving to something that makes more sense,” Mr Buffett wrote in a letter to editors and publishers of Berkshire’s daily newspapers. “We want your best thinking as we work out the blend of digital and print that will attract both the audience and the revenue we need.”
The billionaire, who bought the Buffalo News in 1977 and said in 2009 that newspapers have the potential for unending losses, is now betting that papers with a community focus can profit as they change their models.
12.36pm: Worth keeping an eye on China. Here's another sign of the much-debated slowdown:
China’s biggest banks may fall short of loan targets for the first time in at least seven years as an economic slowdown crimps demand for credit, three bank officials with knowledge of the matter said, according to Bloomberg.
A decline in lending in April and May means it’s likely the banks’ total new loans for 2012 will be about 7 trillion yuan ($1.1 trillion), less than an estimated government goal of 8 trillion yuan to 8.5 trillion yuan, said one of the officials.
Banks are relying on small and mid-sized companies for loan growth after demand from the biggest state- owned borrowers dropped, the people said.
The drying up of loan demand attests to the severity of China’s slowdown and may add pressure on Premier Wen Jiabao to cut interest rates and expand stimulus measures.
The economy may grow in 2012 at its slowest pace in 13 years, a Bloomberg News survey showed last week, as Europe’s debt crisis curbs exports, manufacturing shrinks and demand for new homes wanes.
12.18pm: Meanwhile, stocks look like paring the losses in early afternoon trading. Right now the ASX200 is almost exactly where we started the week.
Still there's a chance it may lower for the week. If it does, that will make it three weeks of declines in a row (albeit a small one for this week is the likely outcome), the longest losing streak in three months.
12.13pm: Bit of a Markets Live mea culpa. Hastie shares are suspended, it's true, at 16 cents. We reported, though, the suspension was earlier today. In fact, the stock has been in a halt since April 13. (Thanks to the reader who pointed out the halt earlier on).
Case of too much haste and less speed.
12.07pm: Gina Rinehart’s new iron ore mine at Roy Hill in WA is not just getting more foreign crews, thanks to the ‘enterprise migration agreement’ noted below.
Looks like it’s also spending or making commitments to spend $1 billion to get production going.
11.59am: There's a big turnaround across most sectors - miners and financials are now down 0.3 per cent and industrials are down 0.7 per cent. The exception is gold stocks - they're up 0.5 per cent.
11.53am: Shares are extending their losses as the market hits a low for the session, so far. The ASX200 is now down 20.3 points, or 0.5 per cent, to 4035.5.
11.48am: More on Hastie... the company's CEO Bill Wild has told BusinessDay that fewer than 10 staff - current and former senior managers and business directors - are under investigation after ''deliberate'' irregularities were found in its financial accounts.
"I don't believe it was done for personal gain, but it's certainly improper behaviour," he says, stressing this was a preliminary view only.
"Some might have done it to ensure the business they were involved in looked good, or because someone put pressure on them."
Mr Wild declined to comment whether its auditors Deloitte Touche Tohmatsu were also being looked at.
11.39am: A membership boom across Australia and the region has helped North American supermarket warehouse group Costco report a 9 per cent rise in its new membership sign-ups, with key executives of the business in Australia currently to discover and develop new sites, BusinessDay's Eli Greenblat reports.
Speaking to analysts overnight on the release of its third quarter earnings performance, Costco chief financial officer Richard Galanti says the Asia Pacific region is driving membership renewals for the business with its international store network star performers within the group.
''Our new member sign-ups in Q3 were quite strong, up 9 per cent on a year-over-year basis, largely due to the strong international openings this past year in Asia and Australia,'' Mr Galanti says.
11.29am: Despite moving higher, the dollar is poised to drop for a fourth week.
The currency traded near a six-month low after data yesterday indicated a contraction in Chinese and European manufacturing.
“Deteriorating global growth is one of the biggest concerns” for the Australian and New Zealand dollars, said Emma Lawson, a currency strategist at NAB.
“As uncertainty in Europe continues to broaden, then you will have high beta currencies begin to soften even further,” she told Bloomberg.
11.24am: The dollar, meanwhile, is edging higher - it's at 97.75 US cents.
11.19am: The Commonwealth Bank says it has cut interest rates on some of its fixed-rate home loans by up to 0.40 per cent.
The new interest rates on two, four and five-year fixed-rate home loans will be available for new borrowers and existing borrowers switching to a fixed rate home loan, the bank says.
Meanwhile, data from Credit Suisse shows investors are prcing in a 1 in 3 chance of a 50 basis-point rate cut from the RBA next month. A 25 basis-point cut is a 100 per cent chance.
The data also shows investors expect 133 basis points to be lopped off the RBA’s benchmark rate in the next 12 months - that’s between 5 and 6 25-basis-point cuts.
11.08am: Financials are now down 0.1 per cent, industrials are 0.2 per cent lower and miners are up 0.2 per cent.
11.04am: Australia's first "enterprise migration agreement" will be announced today, delivering hundreds of foreign workers to one of Gina Rinehart's iron ore projects in Western Australia, Peter Ker reports.
Ms Rinehart's Roy Hill project will be the first to use an "EMA", which is a new type of workplace visa devised by the Federal Government to ease chronic worker shortages in the resources sector.
EMA's are only available to projects worth more than $2billion with a projected workforce beyond 1500. As part of the deal, companies granted an EMA have to provide training to the foreign workers they receive.
11am: The market, as the graph shows, has given up its gains. The ASX200 is now down 3.8 points to 4052.
10.54am: IG Markets analyst Stan Shamu says the local market has responded positively to the Italian prime minister's comments indicating all was not lost with Greece.
''We saw a fairly positive finish in the US session on the back of comments from the Italian PM Mario Monti suggesting that Greece was not going to leave the eurozone,'' he says.
''That was taken as a fairly positive development by markets, as most investors have been looking for any headline or rhetoric about what's going to happen with Greece going forward after the EU summit really failed to give any guidance.''
10.49am: Back to Japan - Tokyo stocks have opened 0.62 per cent higher after overseas markets rebounded from recent drops stemming from worries over the eurozone.
10.44am: Hastie shares are now in a trading halt. They did, however, trade for a while this morning, with about 113,200 shares changing hands, according to Bloomberg data.
10.38am: Worth noting that the $20 million lost to Hastie in what it dubs accounting ‘irregularities’ is basically equivalent to the company’s entire market value. It’s not been a good year for the company, with shares down more than 70 per cent, including today’s retreat.
Meanwhile, David Jones seems to be benefitting from chatter that it might be ripe to be broken up. The shares are up as much as 9 cents, or 4.1 per cent, to $2.29. (Then again, it touched a three-year low earlier in the week.)
BlueScope Steel shares are up as much as 0.5 cents, or 1.5 per cent, to 33 cents after that ratings upgrade mentioned earlier.
AGL Energy, meantime, has been raised to ‘overweight’ at Morgan Stanley in the wake of its plans to mop up the rest of Loy Yang A in Victoria. The company’s shares last traded at $14.45 before entering a trading halt. MS is giving the firm a price target of $16.40.
10.31am: Among the big miners, BHP is up 22 cents, or 0.7 per cent, to $32.21 and Rio has gained 13 cents, or 0.2 per cent, to $56.49 after both ended lower in New York trade. Fortescue is down 10 cents, or 2.2 per cent, to $4.38.
10.26am: JP Morgan says it is paring back Australia's GDP forecasts for both 2012 and 2013.
''We had been contemplating a modest downgrade for 2012, owing to unexpected weakness in key indicators of the domestic activity. We decided to wait for more clarity, though, given conflicting signals. Some recent data, for example, exceeded expectation," JP Morgan says in a note this morning.
"The downgrades to the GDP forecasts for China, however, Australia's largest destination for exports, mean the patchy domestic performance now is matched by disappointment offshore. And, of course, renewed sovereign stress in Europe has increased financial market instability, undermining confidence.''
10.22am: Consumer prices in Japan rose 0.2 per cent year-on-year in April, posting an increase for the third straight month on higher energy costs, official figures show.
The market had expected the core index, which excludes volatile food items, would show a 0.1 per cent hike after a 0.2 per cent rise in March.
The increase stemmed mainly from higher electricity and petrol prices, according to data from the internal affairs ministry.
Japan has been in a deflationary spiral for years, with a series of monetary and fiscal policy moves failing to reverse the trend.
10.17am: Sims shares have slumped after warning its profit will be 85 per cent or less than a year earlier. Its stock is down as much as 76 cents, or 6.2 per cent, to $11.49.
Emeco shares are up as much as 5 cents, or 5.9 per cent, to 89.5 cents on its bullish profit forecast.
10.10am: Among the sectors in early trade, miners are up 0.4 per cent, industrials are up 0.6 per cent and financials have gained 0.2 per cent.
10.04am: Early take on the market: The ASX200 is up 4.2 points, or 0.1 per cent, to 4060.
9.59am: Morgan Stanley, the lead investment bank in Facebook's troubled initial public offering, is understood to be willing to compensate retail investors who overpaid when they bought Facebook's stock.
The firm is reviewing orders its retail clients placed for Facebook stock, and will make price adjustments if they paid too much. What is not clear, howver, is what amount constitutes overpaying for Facebook's stock.
The social network's initial public offering was highly anticipated but the stock closed nearly flat on its first trading day at $US38.23. Morgan Stanley and Facebook are facing at least two lawsuits over the IPO.
9.54am: European markets posted decent gains - but the fears for Greece and the broader economic outlook remain.
European Central Bank President Mario Draghi says the EU is at "a crucial moment in its history" and that the debt crisis has demonstrated the EU's weaknesses.
"The process of European integration needs a courageous jump in political imagination to survive," he says, adding that while growth is a priority, "there is no sustainable growth without ordered public accounts."
9.47am: Electrical and refrigeration company Hastie Group will take a $20 million hit to its full-year profit after discovering ''deliberate'' irregularities in its financial accounts.
The says an employee deliberately caused the irregularities in Hastie's accounts in the 2008/09 financial year. The employee has been suspended.
9.43am: Sims Metal has released a market update this morning, saying that global economic challenges are continuing. It expects it financial year profit to be ‘materially less than 85 per cent’ of a year earlier, according to Bloomberg.
BlueScope Steel, meanwhile, has been upgraded to a ‘buy’ from ‘neutral’ by Bank of America/Merrill Lynch.
9.40am: BHP shares fell again in New York trading, losing 0.5 per cent overnight. The company’s Australian shares are off 7 per cent this year compared with a 0.3 per cent easing for the ASX200 benchmark share index.
Rio Tinto’s US-listed shares also fell, dropping 0.9 per cent overnight. The miner’s Australian shares are down 6.5 per cent in 2012.
9.36am: A quick recap of what happened in the US: The Dow turned higher in the final hour of trade to finish in the black, but downturns across the board in tech stocks hit the Nasdaq for a loss in the day.
The Dow Jones Industrial Average rose 33.60 points, or 0.27 per cent, to finish at 12,529.75. The S&P 500-stock index gained 1.82 (0.14 per cent) to 1320.68, while the Nasdaq Composite fell 10.74 (0.38 per cent) to 2839.38.
It was the third day in a row that the Dow and S&P closed virtually flat.
9.30am: Good morning everyone. Australian stocks could be in for another positive start after gains in the US and Europe - but a worsening economic outlook and increasing uncertainty in Greece could limit any gains.
SPI futures are up 17 points to 4069 but the dollar is lower at 97.58 US cents.
A May survey of eurozone business confidence shows the sharpest monthly fall for nearly three years while the data for Germany was the worst for six months and a survey in France, the poorest for 37 months.
European Central Bank President Mario Draghi said the EU was at "a crucial moment in its history" and that the debt crisis has demonstrated the EU's weaknesses.
For more on how global markets perfomed overnight, here's our preview, need2know.
What you need to know
- SPI futures are 17 points higher at 4069
- The $A is lower at 97.62 US cents
- In the US, the S&P500 rose 0.14% to 1320.68
- In Europe, the FTSE100 rose 1.59% to 5350.05
- Gold rose $10.10 to $US1558.50 an ounce
- WTI crude oil rose $1 to $US90.90 a barrel
- The Reuters Jefferies CRB Index rose 0.17% to 281.92
- Australian business news digest: May 25
This blog is not intended as investment advice
Contributors: Peter Litras, Jens Meyer, Peter Hannam
BusinessDay with wires
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