Increased demand on safe haven still seen within the financial markets today as investors still await the results of a vote by Slovakiaon expanding the euro zone rescue fund. All the euro governments agreed of the EFSF ratification already, andSlovakiais the last to give its acceptance or not.
Till then sentiment continues to be deteriorated, yet the downside pressures seen today were somehow limited by a statement release by the European Union, International Monetary Fund and European Central Bank saying that Greece is likely to receive an 8 billion euro tranche in early November since the Greek government proposed additional austerity measures that confirm the country’s commitment to meet the terms and lower the country’s debt.
Slovakia is likely to agree on the European rescue fund, yet a possible rejection could ignite fears and panic within the market participants since it could prevent the European officials from protecting the region from the spreading debt crisis. France and Germany pledged to help banks by the end of the month, and such an impediment from Slovakia could change the game, and ignite panic selling.
While data from Europe was restricted today to UK’s manufacturing production which fell more than expected to -0.3%, the U.S. will lack the fundamentals, yet markets are awaiting the release of the FOMC meeting minutes scheduled for later tomorrow to get a clearer picture about the health of the U.S. economy which continues to face many challenges.
Stocks in the United States dropped at opening on Tuesday, where the Dow Jones Industrial Average was down by nearly 0.53% to trade around 11,372.70, while the S&P 500 index fell by nearly 0.56% to trade around 1,188.23. European stock indexes were also lower before closing on Wednesday, where FTSE 100 was down by nearly 0.96% trading at 5,346.95 and the DAX was lower by nearly 0.64% to trade around 5,809.71.
The U.S. dollar was rose today against a basket of major currencies on Tuesday, where the U.S. dollar index was trading at 77.85, compared with the opening level at 77.56. The Euro fell against the USD, where the EUR/USD pair traded at $1.3585, compared with the opening level at $1.3642, and the British Pound was down against the dollar, where the GBP/USD pair traded at $1.5625, down from the opening level at $1.5666.
Gold prices also went down affected by the UAD strength, where gold traded around $1665.15 an ounce, and crude oil prices fell, where crude oil prices are trading around $84.85 a barrel, especially after a report from OPEC indicated that world demand on oil may decline this year since global growth may slow.
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