Wed, 16 May, 2012, 2:05 PM EDT - Canadian Markets close in 1 hr 55 mins

Before the bell: Markets mixed as Greece waits for the money

By Liam Lahey | Insight – Tue, 14 Feb, 2012 7:04 AM EST

Global markets are mixed Tuesday morning after Moody's Investor Service downgraded the credit ratings of six Eurozone countries and ahead of an important European finance ministers meeting slated for Wednesday at which the second Greek bailout will be discussed.

Thankfully it's not quite a Valentine's Day Massacre, as the Moody's ratings cut — which included Spain and Italy and could extend to Great Britain, France and Austria — was offset by strong German economic data.

The benchmark Stoxx Europe 600 Index was recently just 0.1 per cent lower at 262.92. London's FTSE 100 fell 0.2 per cent to 5894.13 and Paris's CAC-40 slipped 0.1 per cent to 3381.45, but Frankfurt's DAX was 0.2 per cent higher at 6749.91. The euro currency is trading at US$1.3168.

In Asia, the Eurozone downgrades weighed on investor confidence but Japanese stocks rebounded after that country's central bank announced it will boost its liquidity.

Australia's S&P/ASX 200 Index lost 1 per cent to 4242.80, China's Shanghai Composite declined 0.3 per cent to 2344.77, and South Korea's Kospi fell 0.2 per cent to 2002.64. A rally in property shares helped Hong Kong's Hang Seng Index shake off losses for a 0.1 per cent gain to 20,917.83, while the monetary easing in Japan sent the Nikkei 225 Stock Average to end 0.6 per cent higher at 9052.07.

On Wall Street, U.S. futures point to a higher open. Dow Jones Industrial Average futures rose 14 points to 12849. S&P 500 futures increased by 1.9 point to 1351 and Nasdaq 100 futures gained 5.25 points to 2573.

Economic data due on Tuesday include the U.S. Commerce Department's January retail sales and import prices reports. Also noteworthy, U.S. Treasury Secretary Timothy Geithner will testify on President Barack Obama's budget request for fiscal 2013, at the Senate Finance Committee.

Closer to home, Canada's benchmark S&P/TSX Composite Index was buoyed by Greece's austerity measures agreement. The TSX edged higher 9.27 points to close at 12,398.69 on Monday. The TSX Venture Exchange fell 4.15 points to 1,649.4. The Canadian dollar is trading at 100.07¢ US.

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1 comment

  • Send Tomee
    Send Tomee  •  3 months ago
    Greece, the Italy, Portugal, Spain, Ireland UK and US will all get money. No default is permitted. The cost of default is much greater than that bandaids. They will drag this crisis out until paper money becomes worthless and the system collapses and a new one is born based on some asset. The derivatives are a large problem. The banks have these on their off balance sheets, trillions of wothless derivatives that cannot be paid out, hense, a 70% haircut is considered not a default by the regulatory body for derivatives which is run by the banks. QE to infinity is the only tool.
    • wjmdurham
      wjmdurham 3 months ago
      Easy fix - back to the gold standard. The major currencies - U.S., U.K., Euro, Canada, Aussie, etc would be FIXED to an exchange rate and gold with the currencies made with a tiny gold leaf ( similar to the hologram with which we are familiar) of the value of the note imbedded (easier with th polymer notes). This would eliminate the nations ability to cheat their currency holders (mainly their citizens) of the value of their currency and force gov'ts to be more fiscally responsible.
    • Send Tomee
      Send Tomee 3 months ago
      The thought of returning to a gold standard would somehow solve the problems of the world are mixing facts and fantasy. The Bretton Woods gold standard collapsed because (1) we printed dollars without limit, but (2) kept to the gold standard at $35 an ounce. The problem of using gold as a fixed standard and the exclusive form of MONEY is simple. If there is only 100 ounces of gold and 100 people, the value gold would have is clear. If the number of people increases to 1,000, but we still have only 100 ounces of gold, we get DEPRESSION. Assets would DEFLATE instead of INFLATE. The value of GOLD would rise and everything else including wages would decline against gold since everything would increase in supply against a fixed amount of gold. There has NEVER been a successful gold standard that ever lasted for this very reason.
      The Great Depression ended in each country as they ABANDONED the gold standard. What they are shoving down the throat of Greece right now is the very DEFLATION that was created by a gold standard. Whenever the supply of MONEY contracts and population rises, you create DEFLATION regardless what you are using for MONEY. This is simple reality.
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