23 May 2012: Stocks fall on Greece fears, Facebook’s stock falls over 18%

  • Stocks down again on Greece exit fears, Commodities under pressure again:
    After a strong start on Tuesday, most indices shed their gains as the mood turned sour on Greece’s possibility of euro exit.
  • Stocks: FTSE All World rose more than 1% but finished 0.7% higher; FTSE Eurofirst rose 1.91%; In Asia, Nikkei lost 1.17%; S&P 500 surged more than 1.6% but losses later in the day saw it finish flat; FTSE 100 has finished 1.86% higher today and is at 5403
  • Currencies: Euro fell almost 1% to $1.2685 after the Greek PM’s remarks to Dow Jones
  • Debt: German Bunds are at 1.47%; US 10-years are at 1.77%
  • Commodities: Brent Crude fell 0.7% to $107.63/barrel; Copper lay flat at $3.50/pound; Gold loses 0.3% at $1589/ounce
  • OECD says ‘world trying to recover’: In their report, OECD explain the possibility of a further contraction in eurozone, and the realistic possibility of another contagion. In the ‘ideal’ scenario, a contraction of 0.1% is predicted in the eurozone, while growths of 2.4% and 2% are predicted in USA and Japan. 
  • Europe modifies its stand on Iranian sanctions: Western countries are prepared to provide Iran with an ‘oil carrot’ that would allow it to trade oil in Asia, if Iran can provide the assurance that it is not building an atomic bomb. Germany and the EU prepare for talks this week with Iranian officials. Waiving the EU ban would allow China, India and Japan to buy shipping insurance in London, which dominates the market. 
  • Facebook stock falls over 18% since issue: Since its IPO, the Facebook stock has fallen from $45 to about $34. NASDAQ’s technical glitch, as well as, an initially ‘inflated’ price are the main reasons being cited. Concerns over Facebook’s growth rate as well as advertising setbacks have made investors wary of the inflated stock price.

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