HERE'S OVERNIGHT MARKET UPDATE> US equities were lower overnight...

HERE'S OVERNIGHT MARKET UPDATE

> US equities were lower overnight after Alcoas earnings and Electronic Arts preliminary results trailed analyst estimates. Chinas move to curb lending to cool down the economic growth also weighed on the markets. At the time of writing, the DJIA was down 0.6% to 10600, the S&P 500 fell 1.1% to 1134 and the Nasdaq was 1.5% lower at 2277.

> US bond yields dipped sharply overnight on disappointing corporate earnings news and on Chinas move to increase reserve requirements that fuelled speculation that slowing down economic growth would increase the safe haven appeal of US debt. The US sold $40bn of 3-year notes at a yield of 1.490%. The 2-year yield declined 3bps to 0.903%, whilst the 10-year yield dipped 10bps to 3.715%.

> The Australian SPI 200 Mar 10 futures contract was down 55 points or 1.1% to 4836.

> Australian bond futures moved in line with US Treasuries. The implied yield on 3-year bond futures was down 8bps to 5.090% (price up 8bps to 94.910) and the implied yield on the 10-year bond futures lost 11bps to 5.610% (price up 11bps to 94.390).

> European equities declined overnight after earnings from Alcoa and Beiersdorf missed analyst estimates and China raised reserve requirements for the nations lenders. The DJ Euro Stoxx 50 fell 1.1% to 2977, the German DAX lost 1.6% to 5943 and the FTSE was 0.7% lower at 5499.

> It was a mixed night for the USD after China imposed curbs on lending by increasing reserve requirements for banks. EUR/USD opens marginally lower at 1.4494 after touching a high of 1.4546 overnight. GBP/USD opens stronger at 1.6176 after trading higher in the night on better than expected UK trade data. USD/JPY fell sharply overnight and opens todays session weaker at 90.92.

> The AUD weakened against the major crosses overnight following China's move towards less accommodative monetary policy and softer commodity and equity prices. AUD/USD dipped to 0.9170 before recovering to around 0.92. AUD/EUR has slipped to around 0.6350, while AUD/GBP has declined below 0.57 for the first time in five days. Moves lower in AUD/JPY and AUD/NZD have found good support around 83.40 and 1.2440 respectively.

> Crude oil fell to a five-week low after the US Energy Department lowered its outlook for global oil consumption in 2010 to 85.18 million barrels a day from 85.22 million in December and China moved to slow down the economic growth. WTI futures contract for January fell 2.1% to US$80.76 a barrel.

> Spot gold fell overnight as the US dollar rebounded eroding the appeal of the metal as an alternative asset. Spot gold declined 2.1% to US$1,127.13 an ounce.

>LME copper decreased 1.5% to US$7455 after China ordered banks to increase reserves, signaling the countrys commodity demand may ease. Other base metal futures traded negative with zinc, aluminium, lead and nickel decreasing 3.8%, 2.1%, 3.9% and 1.1%, respectively.

> US corn dipped 7.1% after the US said farmers harvested a record crop and projected bigger global inventories before the next harvest. Soybeans declined 2.9% and wheat fell 6.3% after a US government report showed stockpiles rose and global output increased. Sugar increased 2.3% on signs that countries including India would increase purchases to ease tight inventories. Palm oil futures were 0.4% lower.

GOOD LUCK TO ALL TRADERS!