Here's my summary of the key news overnight in 90 seconds at 9 am, including news more US indicators are turning down.
American consumer confidence fell in February when the markets were expecting a rise. It wasn't a big fall, or even statistically important, but it does have heads being scratched.
The manufacturing index of the Richmond Fed fell also when markets were expecting a rise. This one was more dramatic and equally unexpected.
These two data reports are more in a trend of soft data for the US. Previously these types of results had been dismissed as 'weather-related' but markets are less sure now.
From China too we are getting 'cooling' data. Property prices are losing steam, and confidence in property has taken a hit. And yesterday, the Chinese government warned that first quarter trade data will "be volatile". Questions are being asked about recent currency trends too.
Reinforcing that, the Aussies are seeing a significant drop in the price of iron ore which is now below US$120/tonne and a long way down from the almost US$190/tonne in February 2011. Apparently there is real pain for small miners under US$100/tonne although the big two - BHP and Rio - are ok all the way down to US$60/tonne. Some think the coming low may be at US$80/tonne.
And speaking of Aussie cutbacks, Qantas is about to embark on a really big retrenchment, and Fonterra has added its voice to 'workplace reform' there in a drive to make its Australian operations more competitive.
Aussie consumer confidence is tracking down at the moment, and you can see why.
The Europeans are feeling brighter and leading them economically are both Germany and the UK. But France looks like it about to break promises to restrain its deficits.
New York equity markets are marking time - albeit at a high level - but the down trend is evident on UST 10 year bond yields which are now at only 2.71%, and the oil price is falling. Gold is up to over US$1,340/oz.
The NZ dollar was completely becalmed overnight and we may as well have been in old-fashioned fixed relationships. We start today again at 83.3 USc, 92.3 AUc and the TWI is at 78.1.
If you want to catch up with all the changes yesterday, we have an update here.
The easiest place to stay up with today's event risk is by following our Economic Calendar here »
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2 Comments
People are trying to retain ther 'wealth'.
The Chinese are putting it into bricks and mortar in stable countries; regardless of 'cost' they have a tangible asset.
Others are hoping via shares. They're doomed to be less than happy. As will ACC, and all the Depts that are doing 'well' numerically.
What almost everyone seems not to grasp, is that wealth is the presumed ability to purchase processed parts of the planet, in the future. There is now more presumed ability, than there is available planet. Hence all sorts of things getting out of kilter, defying hithertofore proven rationales.
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