1. Italy is in a political deadlock. President Sergio Matterella blocked the nomination of eurosceptic Paulo Savano as finance minister and appointed former IMF official Carlo Cottarelli as interim prime minister until new elections can be held. As the political situation in its third-largest economy deteriorates rapidly, there are fears the eurozone may plunge headlong into another crisis. Billionaire investor George Soros says “the European Union is mired in an existential crisis”. Business Insider has tried to break down exactly what’s going on and why it’s all happening here.
2. Markets are spooked. Stocks plummeted on Tuesday as unease surrounding political turmoil in Italy spread across global markets. The Dow Jones industrial average shed about 500 points at session lows, and is expected to weigh on the ASX at the open. ASX futures were down 50 points at 6.55am AEST. Meanwhile, Italian bonds had their worst day in 25 years. Yields on 10-year BTPs soared more than 50 basis points.
3. Currencies hit. The euro also tumbled to a six-month low against the dollar. Risk assets have been sold off all around the world, and the Aussie dollar has not been immune to the carnage. As a well-known proxy for investor risk sentiment, the AUD/JPY led the losses with a drop of more than 1%. The AUD/USD fell by a smaller 0.5%, finishing the session at .7504.
4. Foreign investors are turning their back on Australia’s housing market. According to data released by Australia’s Foreign Investment Review Board, the value and number of approvals for foreign investment in Australia’s housing market tumbled last financial year to 13,198 from 40,149 — that’s a $47.2 billion difference.
5. The banking royal commission continues. The latest to give evidence was another hotel owner who fell out with Bankwest just a few years after taking out a $1.2 million loan to buy a pub. Two years after it was bought for $1.6 million, the bank sent in accountants who valued the business at $250,000. The firm behind the valuation were subsequently appointed receivers and sold the business for $525,000. More here.
6. China’s Communist Party has so much power in New Zealand that Western countries might stop sharing intelligence, according to a former CIA China expert. The ex-analyst said the action should be taken in response to the New Zealand PM’s denials of any influence attempts by the Chinese Communist Party (CCP). Both Australia and New Zealand have been hosting intense discussions over CCP influence. It comes as Australian media recently confirmed a secret government report that uncovered CCP influence within all levels of politics.
7. Barnaby Joyce is reportedly taking personal leave amid the fallout from his $150,000 interview deal. According to Fairfax Media, Joyce is taking four weeks of leave from Parliament. He is scheduled to return to Parliament in August, after the July 28 by-elections.
8. A search will resume this morning for a 10-metre humpback whale which was seen to be in distress yesterday, caught in ropes off Sydney’s Bondi Beach. NSW National Parks and Wildlife Service will try to locate the animal this morning, weather permitting, to make an assessment of its condition and how the entanglement can be removed.
9. The father of the four-year-old boy rescued in the viral “Spider-Man of Paris” video was playing Pokemon Go at the time of the incident, according to French prosecutors. He faces two years in prison for his neglect.
10. “Life is not just about glory.” Cristiano Ronaldo’s time at Real Madrid might be up. “It was nice to be at Real Madrid,” he said, after winning another Champions League title. When it was suggested that his past tense comment implied a goodbye was on the horizon, he added: “In the coming days you will have my answer.” He later clarified his comments saying, “money is not the problem”.
“I’m not upset because I know what I give to the club… I cannot guarantee anything. I’m not going to hide, in the next few days I’ll talk… Life is not just about glory.”
Have a great day.
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