The Alfred Jewel (Photo credit: Wikipedia)
Global markets continued their slide: Stoxx -1.4%, Germany -1.2%, France -1.2%, Italy -1.7%, Spain -1.2%, U.K. -1.2%, Dow -1.2% to 12448. S&P -1.46%, Gold +2.43% to $1573.95
Is gold [stockquote]GOLDBEES[/stockquote] poised for a takeoff? Three reasons:
- Citibank analyst, Tom Fitzpatrick, thinks so. He also feels equity markets are going to continue to see a lower move in the weeks ahead. (KWN)
- “There has been a reevaluation of gold now. There’s a cautious flight to quality that’s attracting buyers” (CNBC)
- China’s investment and jewellery demand reached 255.2t up 10% on the previous year’s levels. China is now the largest jewellery market for the third consecutive quarter. (Gold)
The cost of repayment of overseas loans and bonds, estimated at more than $100 billion in the next few years, may climb substantially, with the rupee depreciating nearly 12% since its peak this year. Companies that have substantial overseas borrowings: [stockquote]BHARATFORG[/stockquote] [stockquote]RECLTD[/stockquote] [stockquote]BHARTIARTL[/stockquote] [stockquote]ADANIPOWER[/stockquote] (ET)
One positive side-effect of the Eurozone crisis is falling commodity prices. Australian thermal coal has fallen to $98/ton, down 21% from its average Q1 daily price Y/Y. Will this provide a lift to domestic power producers who import most of their coal?
Some extra-bearish commentary from Grice (via FT):
Maybe all the Anglo-Saxon central banks have done is create the illusion that our sovereigns are more solvent than they are, and that our budget constraints are really a safe distance away. But I don’t think they are. And I think the truth gets out eventually. The Enrons, the Allied Capitals, the Bernie Madoffs … they all get their comeuppance.
File this under Greek Tragedy: The country’s pharmacies are owed €500m by the state-backed healthcare insurer. From next week patients will have to stump up the cash for their medicines upfront, and then claim a reimbursement. The problem is that if the insurer is having trouble paying the pharmacists, it’s unlikely to find it any easier to reimburse individuals. (FT)
A round-up of commentaries on the Eurozone Bank Run of 2012 can be found here: TRB
Have a nice weekend!