Local shares thudded to a two-week low this morning as regional markets suffered the aftershocks of fraud charges levelled against Wall Street goliath Goldman Sachs.
At lunchtime the ASX 200 was down 66 points or 1.33% at 4918 as all sectors lost ground. Worst hit were property trusts -1.7%, financials -1.6% and materials/metals & mining, both down -1.5%. I.T. at -0.2% and telecoms at -0.1% were the pick of a sorry bunch.
In Japan, the Nikkei slumped 1.81% to a three-week low as the rout in financial stocks that started in the U.S. on Friday rippled through the market. Shanghai was recently down 1.86% and Hong Kong's Hang Seng was off 1.44%. Dow futures were at a glum -35 after weekend revelations that Goldman Sachs knew about the S.E.C. investigation nine months ago but failed to disclose the probe to investors. (More here: http://www.marketwatch.com/story/goldman-had-9-months-warning-from-sec-report-2010-04-17)
Goldman's troubles deepened over the weekend when British Prime Minister Gordon Brown and German Chancellor Angela Merkel announced they would ask their financial watchdogs to talk to the S.E.C. about its lawsuit. The two countries rank as Goldman's most important markets in Europe.
Commodity prices remained under pressure this morning as the U.S. dollar attracted investors in search of a safe haven. Crude oil futures declined a further $1.49 or 1.8% this morning to $81.75 a barrel. The spot gold price was steadier but off 80 cents at $1,136 an ounce.
A good morning here but could have been better. (Alanmcg, your trading makes me feel like a Model-T Ford sharing a race-track with a Ferrari. You're raising the bar!) AGO was the pick of my bounce trades but there were also modest profits in ARM, ROL and SGM. There were plenty of other opportunities but my buy orders were mostly in the wrong shares and sat unfilled. PVE half-position from Friday is looking much better now.
