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Portugal Ten Year Yield Soared To 8%, Europe And Asia Tanked

Published 07/04/2013, 02:18 AM
Updated 02/02/2022, 05:40 AM

Asian markets closed mixed today but mostly lower by giving up some of their gains made yesterday. Investors were spooked in Asia as concerns started mounting about the growth of the second biggest economy of the world, China. The economic data for China showed that the country’s services sector soared at much weaker pace during the month of June. However, the HSBC privately observed China Services Business Activity index increased to 51.3 in June as compared to the reading of 51.2 during May.

Traders are also cautious ahead of the mother of all data- US Non-Farm payroll which is due on Friday. This data will be closely watched by the Federal Reserve Bank and their decision of tapering the quantitative easing could be heavily influenced by this data.

The Hang Seng Index was the worst performing index during the session which closed with a loss of -2.48%. The index is down nearly -10.03% for a month. The Shanghai index was the second worst performer and closed with a loss of -0.63%. The Nikkei index recorded its first lost in past five days and was also down with a minor loss of -0.30%.

Banks and property developers came under pressure in Hong Kong due to the Chinese economic data and shares of China Construction Bank Corp and China overseas Land & Investment Ltd both lost nearly -3.3% and -2%. Gold miners soared as the precious metal bounced strongly back up from its support and shares of Newcrest Mining Ltd increased by nearly 5.9%.

European stock markets are also trading sharply lower during the early hours of trading. The ten year yield on Portuguese bond has soared above 8% for the first time since November as the ministers in Portugal have started to resign against the austerity. The euro zone’s debt crisis is back on front and traders are adding to their short position which is adding a selling pressure across the indices in Europe.

All major stocks are trading in a deep red territory on the back of growing crisis in Egypt and political turmoil in Portugal. Shares of HSBC are trading lower by nearly -1.5%. Vodafone, Sanofi SA and Total SA are all trading lower by nearly -1%, -1.5% and -1% respectively.

DISCLOSURE & DISCLAIMER: The above is for informational purposes only and NOT to be construed as specific trading advice. responsibility for trade decisions is solely with the reader.

by Naeem Aslam

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