Global markets go nuts amid EU summit apprehension

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The euro traded in a narrow range in Asia on Thursday as investors looked to a European Union summit starting later in the day, amid shrinking hopes for a breakthrough fix for the region’s fiscal woes. The common currency bought $1.2491 and 99.20 yen in Tokyo trade, from $1.2467 and 99.38 yen in New York late Wednesday. The dollar was weaker at 79.44 yen from 79.71 yen in US trade.
ASIAN MARKETS MIXED
Asian markets were mixed on Thursday with a positive lead from Wall Street offset by low expectations of a breakthrough at a key EU summit to resolve the spiralling eurozone debt crisis. The euro was little changed as investors waited anxiously to see if European Union leaders gathering for a two-day meeting starting later would offer any major support to the ailing single currency. Tokyo stocks were 0.91 percent higher by noon, while Sydney edged up 0.23 percent. But Hong Kong was flat, Seoul was down 0.27 percent, and Shanghai slipped 0.41 percent.
OIL PRICES DROP
World oil prices dropped on Thursday, mirroring the pattern across financial markets, as traders awaited the outcome of an EU summit on the eurozone debt crisis. Brent North Sea crude for delivery in August fell 80 cents to $92.70 a barrel approaching midday in London. New York’s main contract, light sweet crude for August, lost 31 cents to $79.90 a barrel.EU leaders debate “a big leap forward” to strengthen their union and save the euro at a two-day summit starting Thursday, but divisions may scuttle efforts to shore up the single currency.
Eu stocks, euro slide
European stock markets and the euro slid on Thursday with traders waiting to see if an EU summit will deliver concrete steps to tackle the eurozone’s spreading debt crisis. London’s benchmark FTSE 100 index dropped 1.0 percent to 5,468.22 points, Frankfurt’s DAX 30 shed 1.80 percent to 6,116.43 points and in Paris the CAC 40 tumbled 1.20 percent to 3,026.44. Madrid’s IBEX 35 slipped 0.70 percent to 6,619.00 points. In foreign exchange deals, the euro retreated to $1.2431 from $1.2467 late on Thursday in New York. “European politicians have done a fantastic job of lowering expectations for the EU summit that begins today, which means that even the smallest ‘breakthrough’ may cause a short-term relief rally” across financial markets, said Kathleen Brooks, research director at Forex.com trading group. EU leaders debate a so-called “a big leap forward” for increased integration and save the euro at a two-day summit in Brussels, but splits might scuttle efforts to ring fence the single currency. European Union heads of state and government gather from 3:00pm.
ALL EYES ON TENSE SUMMIT
EU leaders debate “a big leap forward” to strengthen their union and save the euro at a two-day summit starting Thursday, but divisions may scuttle efforts to shore up the single currency. European Union heads of state and government gather from 3:00 pm (1300 GMT) as the debt crisis, now in its third year, widens to Cyprus and Spain after contaminating Greece, Portugal and Ireland. And with Italy, the third largest eurozone economy Italy too under threat, the EU is under pressure from world leaders to prevent a collapse of the single currency that would have unfathomable global repercussions. Europe’s leaders are expected to agree a growth pact to revive the continent’s flagging economies and propel the 27-nation bloc towards greater union, the first step being a banking union.