7 May 2012

Tough week on Wall Street

8:48 am on 7 May 2012

Wall Street had its worst week of the year with all eyes on the European elections on Sunday.

The austerity measures of incumbent governments in France and Greece, though deeply unpopular, are seen as positive for stocks as they seek to prevent a credit crisis in Europe that could take down or hurt the global economic recovery.

Analysts said the expected election of Socialist Francois Hollande as the new French president has wide implications for the whole eurozone.

Mr Hollande has vowed to rework a deal on government debt in member countries.

The Dow Jones Index closed down 168 points, or 1.3% on Friday, at 13,038.

The Nasdaq Composite fall 68 points points, or more than 2%, to 2,956

The FTSE in London, the DAX in Frankfurt and the CAC-40 in Paris were all down nearly 2% on Friday.

The Australian 200 Index closed down 35 points, or nearly 1%, at 4459. The NZX 50 fell 27 points, 0.8%, to close at 3550

At 8.20am on Monday, the New Zealand dollar was trading at 79.24 US cents, 78.07 Australian cents, 49.15 pence, 63.22 yen and 0.6092 euro. The Trade Weighted Index was at 70.98.

Brent crude oil was trading at $US112 per barrel and gold was trading at $US1642 per ounce.