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Johannesburg/ New York - Global stocks and the euro fell on Monday after Germany dashed expectations of a breakthrough to the eurozone debt crisis at a highly anticipated upcoming summit of the European Union.
German Finance Minister Wolfgang Schaeuble said that even though European governments would adopt a five-point platform
to address the two-year-old crisis, a definitive solution would not be reached at the October 23 summit.
The remarks took the wind out of recent optimism that had sparked a rally in global stocks of more than 10% in just nine days and had pushed benchmark 10-year US Treasury debt yields to post their best three-week advance since late December.
Shares in Europe and the United States retreated and crude oil extended losses. The euro slid from a one-month high
against the US dollar touched earlier in the global session, falling 0.9% to $1.3756.
“There’s nothing but uncertainty in Europe,” said David Ader, head of government bond strategy at CRT Capital in Stamford, Connecticut.
“This weekend and today is the perfect example. October 23 seems to be the deadline for a plan for Europe, but the Germans
are balking.”
Renewed jitters
MSCI’s all-country world equity index fell 0.8% and the pan-European FTSEurofirst 300 index of top shares fell 1.1%.
Britain’s leading share index closed lower giving up early gains, as miners and banks went in to reverse. The FTSE 100 index closed down 0.5%at 5 436.70, having dropped from an intraday peak of 5 543.72, back below technically important levels around 5 450 which it breached for the first time in 10 weeks on Friday.
South African stocks retreated on Monday with risk-averse investors piling into safe-haven stocks such as gold miners. The Top 40 - (Tradeable) [JSE:J200] index of blue-chips lost 41.45 points, or 0.15%, to 27 798.31. The broader All Share [JSE:J203] index eased to 31 095.23, a 0.1% drop.
On Wall the Dow Jones industrial average was down 1.21%, Standard & Poor’s 500 Index was down 1.16% and the Nasdaq Composite Index was down 1.13%.
Brent crude fell $1.12 to $111.11 a barrel, reversing earlier gains. US crude was down 34 cents at $86.46.
Still, some investors said that EU leaders had made progress in moving to contain the sovereign debt, suggesting markets might rebound.
“Although there is still uncertainty surrounding what might ultimately come out of the eurozone, we are infinitely closer
to something concrete than we were over the last several weeks,” said Brad Bechtel, managing director at Faros Trading
LLC in Stamford, Connecticut
German Finance Minister Wolfgang Schaeuble said that even though European governments would adopt a five-point platform
to address the two-year-old crisis, a definitive solution would not be reached at the October 23 summit.
The remarks took the wind out of recent optimism that had sparked a rally in global stocks of more than 10% in just nine days and had pushed benchmark 10-year US Treasury debt yields to post their best three-week advance since late December.
Shares in Europe and the United States retreated and crude oil extended losses. The euro slid from a one-month high
against the US dollar touched earlier in the global session, falling 0.9% to $1.3756.
“There’s nothing but uncertainty in Europe,” said David Ader, head of government bond strategy at CRT Capital in Stamford, Connecticut.
“This weekend and today is the perfect example. October 23 seems to be the deadline for a plan for Europe, but the Germans
are balking.”
Renewed jitters
MSCI’s all-country world equity index fell 0.8% and the pan-European FTSEurofirst 300 index of top shares fell 1.1%.
Britain’s leading share index closed lower giving up early gains, as miners and banks went in to reverse. The FTSE 100 index closed down 0.5%at 5 436.70, having dropped from an intraday peak of 5 543.72, back below technically important levels around 5 450 which it breached for the first time in 10 weeks on Friday.
South African stocks retreated on Monday with risk-averse investors piling into safe-haven stocks such as gold miners. The Top 40 - (Tradeable) [JSE:J200] index of blue-chips lost 41.45 points, or 0.15%, to 27 798.31. The broader All Share [JSE:J203] index eased to 31 095.23, a 0.1% drop.
On Wall the Dow Jones industrial average was down 1.21%, Standard & Poor’s 500 Index was down 1.16% and the Nasdaq Composite Index was down 1.13%.
Brent crude fell $1.12 to $111.11 a barrel, reversing earlier gains. US crude was down 34 cents at $86.46.
Still, some investors said that EU leaders had made progress in moving to contain the sovereign debt, suggesting markets might rebound.
“Although there is still uncertainty surrounding what might ultimately come out of the eurozone, we are infinitely closer
to something concrete than we were over the last several weeks,” said Brad Bechtel, managing director at Faros Trading
LLC in Stamford, Connecticut
