ABC Home | Radio | Television | News | More Subjects… | Shop

Email

No end in sight for trading turmoil

Posted August 16, 2007 08:03:00
Updated August 16, 2007 09:17:00

More volatility: Wall Street and European markets showed mixed results overnight

More volatility: Wall Street and European markets showed mixed results overnight (AFP/Getty Images: Mario Tama)

US markets have continued to unravel on another volatile day, as the country's Federal Reserve pumped another $US7 billion into the financial system to boost liquidity.

The Fed's injection took its total infusion of funds in the current episode to $US69 billion, with the central bank saying it stands ready to act as required.

Investor fears are based on the unknown extent of the US credit market problems.

The market has been hurt by rumours that leading mortgage lender, Countrywide Financial Corp, has been unable to raise money from the commercial paper market.

On the New York Stock Exchange, the Dow Jones industrial average traded in a range of almost 300 points.

A morning rally evaporated as the Dow finished 167 points lower at 12,861, a fall of 1.3 per cent, and the first time it has closed below 13,000 since April.

The high-tech Nasdaq composite index dropped 40 points to 2,459.

On the economic front, inflation in the US is in line with forecasts, with the Consumer Price Index up just 0.1 per cent in July.

The British share market has moved moderately lower.

London's FT-100 index has fallen 34 points to 6,109.

Yesterday the Australian share market saw more than $40 billion wiped off the value of listed stocks.

The All Ordinaries index plunged 181 points to end at 5,802.

Banks and miners led the way down.

Commonwealth Bank shares fell $1 to $53, despite Australia's biggest home lender announcing an annual profit of $4.5 billion.

Looking at trade overnight on the Sydney Futures Exchange, the Share Price Index 200 contract has closed down 79 points at 5,702, a slide of 1.4 per cent.

The 10-year bond contract is up half a point at 94.10, with the implied yield easing to 5.9 per cent.

On foreign exchange markets, the Australian dollar continues to slide, as global investors unwind riskier positions.

A short time ago, it was being quoted at 81.95 US cents, down three-quarters of a cent on yesterday's local close.

On the cross-rates, it is at 0.6096 euros, 95.48 Japanese yen, 41.21 pence Sterling and $NZ1.154.

The gold price is at $US667.80 an ounce, and the spot price of West Texas crude oil has jumped 96 cents to $US73.36 US a barrel.

Tags: stockmarket, futures-markets, currency-markets, australia, united-states