This news is begining to preoccuppy me just a little. Going back to what Lloyd and then Joerg were saying last week, is history about to extract a heavy price for our indigence of vision here? I can see no clear and easy way out. Neither the euro nor the yen can live with this. Yet the dollar slide is slated to continue, Greenspan is in no position to raise US rates any time soon, and the ECB either doesn't want - or isn't able (euro bind) - to lower them here. It's hard to see what will happen next - but something, logically, has to give somewhere.
European markets were trading lower in the mid-morning trade after the euro hit yet another record high against the dollar. The weakness of dollar prompted investors to sell exporters such as Germany's automaker DaimlerChrysler. The technology stocks were also sliding.
The pan-European FTSE Eurotop 300 was down 0.8 per cent at 930.8. In Frankfurt, the Xetra Dax 30 was down 1.4 per cent at 3,790 and in Paris, the Cac 40 lost 1.1 per cent to 3,420. In London, the FTSE 100 index fell 0.6 per cent to 4,340.
In New York on Friday, the Dow Jones Industrial Average finished down 0.7 per cent at 9,862.7, as weaker than expected US jobs data unnerved investors. The Nasdaq Composite was off 1.6 per cent at 1,937.8, hit by a disappointing outlook from Intel, the world largest chip maker. Chip stocks in Europe may suffer in early trade as peers play catch-up.
Exporters felt the heat as the dollar sank to a new record low against the euro. The greenback was last trading at 1.2191. Autostocks were affected, with Volkswagen down 1.4 per cent at €42.4, DaimlerChrysler down 1.6 per cent at €33.4 and BMW off 1 per cent at €36.
Source: Financial Times