Good morning. Here’s what you need to know.
- Asian markets were down in overnight trading with the Hang Seng plummeting 4.38%. Europe is sharply lower and U.S. futures are moderately lower. Meanwhile, the copper sell-off continues.
- Greece announced yesterday that it would miss 2011 and 2012 budget deficit targets set by the EU and IMF. 2011 deficit is expected to be 8.5% of GDP against a target of 7.6% and 2012 deficit is expected to fall to 6.8% against a target of 6.5%. The government plans $8.8 billion in new austerity and said it would put 30,000 public sector employees on partial pay and lay them off after a year. Now here’s who will get crushed if Greece goes bust >
- European manufacturing contracted for a second straight month, falling to 48.5 in September, from 49 the previous month. Meanwhile, manufacturing in Japan took a hit after the tsunami and earthquake earlier this year. Latest data shows that sentiment among Japan’s largest manufacturers rose to 2 in September, from -9 in June, but reflects that manufacturers think recovery is being slowed by the global economic crisis. Check out the 15 most bizarre economic indicators >
- As talks of a hard landing in China continue, the country released services PMI earlier than expected. The HSBC composite output index which reflects manufacturing and services, rose to a three-month high of 51.5, the business activity index meanwhile climbed to 53 in September. Now here’s why everyone is freaking out about China >
- Construction spending in August jumped 1.4% against expectations of a 0.2% decline, while ISM manufacturing beat estimates, rising to 51.6 >
- Moody’s said it was reviewing Franco-Belgian bank Dexia for a downgrade because of funding problems that it may have. The stock is taking a hit, and the bank needs to dispose of €20 billion of bad debt.
- Chinese internet company Alibaba’s CEO Jack Ma is “very interested” in buying all of Yahoo Inc. according to a statement he made at Stanford University. The most valuable part of Yahoo is its stake in Alibaba
- S&P affirmed its AAA rating for the U.K. and said its outlook was stable.
- Motor vehicle sales data for September will be released today. Consensus is for an increase in domestic vehicle sales to 10 million units and an increase in total vehicle sales to 12.6 million. Follow the release at Money Game >
- Annual inflation in Australia slowed to 2.8% in September, from 2.9% the previous month. Consumer prices were driven down by declining food and motor vehicle costs. The Reserve Bank of Australia is expected to keep interest rates unchanged at 4.75% when it meets.
- BONUS – Elizabeth Hurley got engaged to former Australian cricketer Shane Warne over the weekend.