Video | Agriculture | Confidence | Economy | Energy | Employment | Finance | Media | Property | RBNZ | Science | SOEs | Tax | Technology | Telecoms | Tourism | Transport | Search


While you were sleeping: Euro contingency plans

While you were sleeping: Euro contingency plans

May 24 (BusinessDesk) - Equities suffered on both sides of the Atlantic as an increasing number of euro zone officials acknowledge preparations are being made for the possibility of a Greek departure from the common currency.

The currency union was formed under the premise that once in, there's no out and a member's exit risks destabilising the trust in the currency and the bloc itself.

Euro-zone officials agreed on Monday that each euro-zone country must prepare an individual contingency plan in the event that Greece decides to leave the single currency bloc, according to Reuters.

The euro dropped as low as US$1.2545, the weakest since July 2010.

A meeting of European leaders in Brussels today is not expected to result in any new measures to stem the crisis.

"A Greek exit would be a Pandora’s box,” Jacques-Pascal Porta, who helps manage US$570 million at Ofi Gestion Privee in Paris, told Bloomberg News. “It’s a disaster that would leave the door open to other disasters. The euro’s credibility will be weakened, and it would set a precedent: Why couldn’t an exit happen for Spain, for Italy, and even for France?”

In Europe, the Stoxx 600 Index ended the session with a 2.1 percent slide for the day. The UK’s FTSE 100 dropped 2.5 percent, Germany’s DAX fell 2.3 percent, while France’s CAC 40 declined 2.6 percent.

Concern about the impact of Europe's ongoing problems weighed on Wall Street, which had disappointments of its own.

In late afternoon trading in New York, the Dow Jones Industrial Average dropped 1.09 percent, the Standard & Poor's 500 Index shed 1.15 percent and the Nasdaq Composite Index fell 1.08 percent. As a sign of investor wariness, shares on Wall Street were paring losses in the final hour of trading.

An 18-percent slump in Dell shares following the computer maker's disappointing forecast for second-quarter revenue hammered both the S&P 500 and shares of rival Hewlett-Packard.

HP, scheduled to report quarterly results after the market close, will post earnings of 91 cents a share, excluding some items, according to the average estimate in a Bloomberg survey. That would be 26 percent less than in the same period last year, the data show.

While the US housing market showed better-than-expected data for the second day in row, it wasn't enough to help today's sentiment. Purchases climbed to a 343,000 annual rate, up 3.3 percent from a revised 332,000 in March, according to the Commerce Department.

The data "adds to the growing sense that housing is stabilising, but it isn't enough to overcome the global issues driving the day," James Dunigan, chief investment officer of PNC Wealth Management in Philadelphia, told Reuters.

Indeed, a report today showed Japan’s exports increased 7.9 percent in April from a year earlier, a gain that fell short of expectations.


© Scoop Media

Business Headlines | Sci-Tech Headlines


Banking: Westpac NZ Lowers Merchant Fees For Small Businesses

Westpac NZ is rolling out a new merchant fee pricing structure that will lead to cost savings for more than 10,000 small and medium Kiwi businesses, and could make contactless transactions more widely available for customers. On 1 September, most ... More>>

REINZ: Million Dollar Plus Property Sales Increase 11.7% Nationally

The number of properties sold around the country for one million dollars or more during the first half (H1) of 2020 increased by 11.7% compared to H1 2019, with 5,426 million-dollar plus properties sold (up from 4,858 in H1 2019) according to the Real ... More>>

Waste: Government To Regulate Plastic Packaging, Tyres, E-Waste

The Government is stepping up action to deal with environmentally harmful products – including plastic packaging, tyres and e-waste – before they become waste. As part of the wider plan to reduce the amount of rubbish ending up in landfills, ... More>>


Bankers Association: Banking Becomes First Living Wage Accredited Industry

Banking has become New Zealand’s first fully living wage accredited industry, leading to nearly 1800 employees and contractors moving onto the living wage and gaining greater economic independence for them and their families. As of today, all ... More>>


Economy: Funding For 85% Of NZ Not-For-Profit Entities Impacted By COVID-19

Results of a recent Institute of Directors poll show that 85% of board members on not-for-profit organisations say COVID-19 has moderately or significantly affected their funding. The ‘pulse check’ conducted in the first two weeks of July looked ... More>>

Volcano Detection: Eruption Alert System Would Have Given 16 Hours’ Warning At Whakaari

An alert system that could have given 16 hours’ warning of last year’s eruption at Whakaari/White Island is ready for deployment, University of Auckland scientists say, with warning systems for Ruapehu and Tongariro the next priority. ... More>>

Property: Queenstown Rents Experience Biggest Drop In Seven Years

Rental prices in the Queenstown-Lakes district saw the biggest annual percentage drop in seven years after falling 28 per cent on June last year, according to the latest Trade Me Rental Price Index. Trade Me Property spokesperson Aaron Clancy said ... More>>

Seismology: The Quiet Earth

As many daily activities came to a halt during lockdown, the Earth itself became quiet, probably quieter than it has been since humans developed the technology to listen in. Seismologists have analysed datasets from more than 300 international ... More>>

RNZ: James Shaw Says Kiwibank, Not Ministers Should Decide On Investors

Climate Change Minister James Shaw says Kiwibank's decision to stop doing business with companies dealing in fossil fuels is the right one. More>>


FMA: Kiwis Confident Financial Markets Will Recover From COVID-19, Plan To Increase Investments

Despite the majority (60%) of investors experiencing losses as a result of COVID-19, the outlook on investing remains positive, according to a Financial Markets Authority (FMA) survey. Most Kiwis (71%) were optimistic that the pandemic will pass eventually ... More>>

FIRST Union: Warehouse Using Covid For Cover As Extensive Restructure Makes Everyone Worse Off

(FIRST Union comments on The Warehouse consultation and proposed restructure) 'Unfortunately the Warehouse have done the disappointing thing and used Covid-19 to justify a bunch of operational business decisions that will leave hundreds of workers without jobs ... More>>


Stats NZ: Mixed Performance By Regions Leaves National Emissions Picture Unchanged

Approximately two-thirds of New Zealand’s regions recorded decreases in their total greenhouse gas emissions, while one-third of regions saw increases between 2007 and 2018, Stats NZ said today. “While some regions reduced their emissions, ... More>>

RNZ: Economic Activity And Business Confidence Bouncing Back

Two surveys from ANZ show business confidence and economic activity have rebounded, but uncertainty about the future remains extreme. More>>