North American stock investors, you're waking up to a sea of red this morning. Pretty much everything is down: Global equities, U.S. stock futures, oil, gold, corn, wheat, the loonie, silver, gasoline (even after its collapse on Wednesday). The only winner of note is the U.S. dollar.
Investors appear to be doubtful over prospects for global economic growth, and the stronger greenback is also making commodities more expensive to buy. Making matters worse is China's decision to restrict the amount of money its banks lend, for the eighth time since October.
Britain's FTSE 100 was down 1.5 per cent, Paris's CAC 40 down 1.6 per cent, and Germany's DAX down 1.7 per cent. Japan's Nikkei lost 1.5 per cent, while South Korea's Kospi slid 2 per cent and Hong Kong's Hang Seng lost 0.9 per cent.
U.S. stock futures followed suit, with Dow Jones industrials down 0.6 per cent at 12,521 and S&P 500 futures losing 0.7 per cent to 1,329.
The U.S. dollar hit a three-week high against a key currency basket. The euro fell to as low as $1.4123, while the loonie traded at $1.0327 (U.S.) and the yen at 81.35 to the greenback.
COMEX silver futures shed more than 11 percent to reach $34.04 (U.S.) an ounce and were set for their worst two-week slide in nearly 25 years. Losses in silver undermined gold, which dropped 0.6 percent to $1,491.39.
Copper hit a fresh-five month low of $8,540.25.
NYMEX crude lost $1.05, falling to $97.16 a barrel, extending the previous session's sell-off, after the International Energy Agency lowered its forecast for global demand this year.
Chicago wheat was off 0.7 percent at $7.54 a bushel, extending a 5 percent loss from the previous day, after the U.S. government winter wheat crop forecast beat market estimates.
Corn shed 0.7 percent to $6.72-½ a bushel after falling more than 4 percent, its biggest one-day drop since mid-March, on higher-than-forecast ending U.S. stocks due to reduced export demand.
By the way, we have some excellent commodities-related material for you today:
- Mawer fund manager warns of too much faith in commodities
- Dip in energy stocks could be buying opportunity
- Energy’s slide picks up speed
- Gas prices: Are we getting hosed at the pump?