Asian shares fell today, with Japan's stocks slipping nearly 2% to a two-month low, and the safe-haven dollar firmed on concerns that the corporate results season will reveal weaker earnings. The US dollar consolidated under 1.2900 levels against the Euro today; rising for a third straight sessions amid a continued sell off in the world markets following worries over global economic outlook.
The dollar was also aided by fresh worries about Spanish economy. The Eurozone debt struggle continues despite the formal launch of the new bailout facility - the ESM yesterday. The Bank of Spain Chief Economist Malo de Molina stated today that Spanish debt adjustment is proving slow and the country faces risks. He also noted that Spainish government growth forecast is optimistic.
European shares fell for the third day running today, while the euro and Spanish and Italian bonds came under fresh pressure. The International Monetary Fund said in its semi-annual outlook yesterday the euro area's debt crisis was the main threat and the risks to global financial stability had risen in the last six months, leaving confidence very fragile.
The WTI Crude futures had gained yesterday night, recording a massive rise of more than three dollars as escalating tensions between Syria and Turkey triggered worries that about 400000 barrels a day of oil which is shipped to Turkey from Iraq's northern Kurdistan region.
WTI futures are down from highs near $93 and there are signs that a weak open on the Wall Street could hurt the commodity. The MCX futures stayed positive though, hitting highs above Rs 4900 per barrel as the Indian Rupee dropped nearly 50 paise against the US dollar. The local stocks dropped and Rupee was hammered as global rating agency S&P remarked that India still faces a one-in-three chance of a credit rating downgrade within the next 24 months. MCX Crude is at Rs 4903, up Rs 13 per barrel on the day with 1.80% increase in the open interest.
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