Japanese Stocks and the Euro suffered in early Asian trading as investors got to grips with the very real thoughts that the Eurozone may have to roll back some austerity measures that may escalate the European debt crisis. Following the election of socialist Francois Hollande to the French presidency, ousting Nicholas Sarkozy, came the parliamentary elections in much beleaguered Greece. The big concern amongst investors is that both the newly elected governments in Greece and France may undertake a series of spending increases in a bid to stimulate growth. This could see a rise in the debt levels, especially in Greece, again sparking fears about whether the Eurozones economies, with its record unemployment, will be in a position to solve the continuing debt crisis.
At the time of writing (05.00am GMT) Japans Nikkei 225 was down 2.47%, valued at 9148.50 whilst South Korea’s Kospi dropped 1.7% and Hong Kong’s Hang Seng was down 2.5%. The doom and gloom about Europe extended to the commodities markets with Crude Oil down 1.37%, trading at 97.14 a barrel, The precious metals markets suffered too with Gold down 0.40%, trading at 1638.45 a troy ounce and Silver down 0.95%, trading at 30.142.
Investors have embarked upon a course of risk aversion in the opening trading session, with the safe haven currency enjoying the most favour. The US Dollar index which measures the greenback against a basked of 6 weighted currencies was up 0.56%, valued at 80.04, whilst against the Euro the USD was up 0.80%, trading at 1.2979.
At 10.00am GMT today there is the German factory orders data to keep an eye on with an increase from 0.3% to 0.5% expected which ay lift some of the gloom surrounding the Euro.
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