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Daily Analysis – Stocks Tumble as European Bond Yields Surge

ByBinary Options Strategy
Published 12/12/2011, 06:31 AM
Updated 05/14/2017, 06:45 AM
DE40
0.48%
JP225
0.47%
HK50
2.64%
Equities

Asian markets closed mixed, as the major indexes pared early losses. The Nikkei rose .2% to 8480, the Kospi rallied 1.1%, and the ASX 200 ticked up .3%. China’s markets closed lower, as the Shanghai Composite eased .2%, and the Hang Seng dropped .8%, weighed down by real estate companies.

European markets sank, as rising bond prices reinforced fears of contagion. The CAC40 tumbled 1.8%, the DAX fell 1.1%, and the FTSE slumped 1.6%. Spanish bond prices continued to drop, pushing yields on 10-year Spanish notes up to 6.975% in a government auction, with a weak bid-to cover ratio of 1.54.

Currencies

The Australian Dollar fell below the 1.000 parity level, closing down .8% to .9997, and the Yen rose .1% to settle below 77 at 76.98. The Canadian Dollar skidded .5% to 1.0289. The Euro closed up fractionally surrendering early gains, and the Pound gained .2% to 1.5754.

Economic Outlook

Thursday’s economic data was mostly positive. Weekly jobless claims dropped to their lowest level in 7-weeks at 388K, better than forecast. Building permits were higher than expected, while housing starts were in line with analyst expectations. On a weaker note, the Philly Fed manufacturing index unexpectedly dropped to 3.6 from 8.7.

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