The Australian equity market is again set for another weak open ahead of the RBA rate announcement out today at 14h30 after European stocks tumbled as fears for the future of the euro zone increased along with extremely weak economic growth and threats to the global banking sector.
Wall Street was closed for Labor day celebrations but it is likely that there will be a few economic hangovers when traders return to the market later tonight.
The euro fell against all its major trading counterparts as the euro zone debt concerns and political uncertainty in Germany prompting rises in all the safe haven assets. EURUSD (see above chart) traded down from highs of 1.4167 to as low as 1.4060 on scarce liquidity.
GBPUSD traded down from highs of 1.6187 to a seven week low of 1.6060 after a report published in the UK showed that residents are getting less confident about the outlook for employment and a services index declined to 51.1.
The NZDUSD has continued south on risk aversion trading through support levels of 0.8300. At time of writing this report it was trading at 0.8291.
Gold traded up from overnight lows of 1883.67 to above the 1900.00 level as investors look to the precious metal as a safe haven.
WTI oil futures continued to fall overnight to lows of 83.44 on the back of slowing economic growth in the US and a report out of China that showed that the services index fell to a record low in August will mean that they will start to crimp fuel consumption.
SPI 200 future
FTSE 100 Index
Bloomberg, Dow Jones News