In the Netherlands, a failure by Dutch Pirme Minister Mark Rutte to reach an agreement concerning austerity measures caused the nation’s bond yield to spike. Rutte is expected to resign. Widespread concern that the nation will lose its AAA bond rating impacted the share values for automobile manufacturers. Germany’s DAX Index fell by 2.93% to 6,552 (NYSEARCA:EWG).
The Bank of Spain announced that the country is officially in recession as its economy contracted by 0.4% during the first quarter of 2012, marking the second consecutive quarter of decline. GDP is down 0.5% from last year, putting the nation’s deficit target further out of reach, exacerbating the nation’s debt crisis. The yield on Spain’s ten-year bond reached as high as 6.02% on Monday. Spain’s IBEX 35 Index took a 2.92% nosedive to hit 6,834 (NYSEARCA:EWP).
In Italy, consumer confidence dropped to 89.3 – its lowest level in fifteen years – according to a report from Istat (NYSEARCA:EWI).
A composite index of Eurozone services and manufacturing from Markit Economics declined to 47.4 from 49.1 in March, despite economists’ expectations for a slight increase (NYSEARCA:VGK).
In China, HSBC Holdings Plc and Markit Economics released their preliminary Purchasing Managers’ Index for April. Although the reading of 49.1 marked an increase from the March PMI of 48.3, any level below 50 signals economic contraction. The final reading will be due on May 2. China’s Shanghai Composite Index declined by 0.76% to 2,388 (NYSEARCA:FXI). Hong Kong’s Hang Seng Index dropped by 1.84% to 20,624.
Japanese stocks declined slightly on Monday following a disappointing earnings report from the Nippon Yusen shipping company. Public opposition to a restart of the nuclear reactor at Kansai Electric Power caused the company’s share value to decline in excess of 4%. The Nikkei 225 Stock Average fell by 0.20 percent to 9,542 (NYSEARCA:EWJ).
As of 8:38 EDT, the Euro STOXX 50 Index declined by 2.30% to 2,258 (NYSEARCA:VGK). The FTSE 100 fell by 1.71% to 5,673 (NYSEARCA:EWU). The German DAX Index sank by 2.78% to 6,562 (NYSEARCA:EWG).
The euro declined against dollar by 0.38% trading at $1.3134 (NYSEARCA:FXE).
American futures trading posted losses as a result of disappointing reports concerning the global economy. The June 12 Dow Jones Industrials future declined by 0.96% to 12,863 as of 9:10 EDT. The June 12 S&P 500 future also dropped by 0.96% hitting 1,362 (NYSEARCA:SPY). The June 12 Nasdaq 100 future declined by 0.79% to 2,653.
June futures for Brent Crude Oil declined by 3 cents to $118.73/bbl. (NYSEARCA:USO)
June gold futures declined by $13.00 to $1629.00 per ounce (NYSEARCA:GLD)
Bottom line: Europe’s stock indices continue to decline as efforts to control the sovereign debt crisis fail to achieve results.
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