The Australian equity market is pointed to a higher open Monday after the US stocks advanced on Friday evening on the back of massive earnings from Google overshadowed another warning about the US.’s credit rating and a disheartened reading on consumer sentiment. The S&P credit rating agency said there is a 50% chance it would lower the AAA bond rating on U.S. debt within three months.
The S&P index rose 7.2 points to finish the day at 1316.14 while the Dow rose 42.61 points to finish at 12479.73, both the indices are down over 1% for the week.
EURCHF (see above chart) touched all time lows early on Monday morning in light trading. It opened Monday morning on a high of 1.1578 to then trade a low of 1.1373. Investors seem to be choosing the CHF as a safe haven after a weekend interview with Merkel and Trichet seem to be making the Greek debt crisis more unclear and difficult to understand.
Only eight banks out of 90 top lenders in Europe failed the tests for a worst case economic scenario, between them there is a combined shortfall of 2.5 billion Euro’s of capital. Analysts had speculated that over 20 of the banks would fail the tests.
Crude oil futures prices capped a choppy week with a 1.6% rise to above $97 a barrel in U.S. trading Friday, on expectations that U.S. Federal Reserve board policy will continue to support the underlying strength in oil.
Gold finished the week off trading up 0.5% to settlement in U.S. trading Friday at 1593.7, while silver made steady gains, as bleaker U.S. consumer sentiment and government debt concerns in Europe and the U.S. roused investor demand for a safe haven.
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