Wall Street stocks fell broadly as investors eye - US Federal Reserve (FED) two day policy meeting starting tomorrow. Its statement will be closely scrutinized and interpreted for any signal that FED will start tapering monetary easing. Economic data both from Euro zone and the United States last week were better than expected. If July monthly jobless figures to be published at the end of the week comes out on the positive side, this would constitute a strong argument for FED tapering in September as many observers have forecasted.
Dow Jones, Nasdaq and S&P fell broadly yesterday, indicating that the air might start to run out of weeks’ booming stock markets. The European stock markets were also weaker yesterday following a 3,3 %% fall in the Nikkei index in Japan during Monday morning. The steep fall in the Nikkei followed a new increase in the value of the Japanese yen which rose to 97,83 yen to a dollar, a 2 %% gain to the dollar over the last week. A stronger yen works against the interests of the big Japanese exporters and weigh negatively on the Nikkei.
Euro traded steady against the dollar at 1,3261. The International Monetary Fund (IMF) has approved the release of a new tranche of loans to Greece amounting to USD 2.2 B. The release follows a fourth review of the “troika” which together with IMF, ECB and EU releases a tranche of Euro 6,8 B. The total value of the loans granted in March 2012 amounts to Euro 175 Billion over a period of four years. The loans are dependent upon serious austerity measures including firing thousands of state employees, likely to raise to new strikes and social unrest.
Oil prices which peaked to months high last week, have stabilized. Brent crude fell to below USD 107 a barrel on the first trading day on Monday, but has recovered 107,57, NYMEX, New, York crude, which traded higher than Brent for some days ago, stays steady between USD 104 and 105. Gold is down from its high on USD 1338 an ounce last week, trading at 1328. Silver which reached USD 20,50 last week, trades in the interval between USD 19,80 – 20,00 an ounce.
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