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    MORNING BELL: Negative earnings drive the U.S. markets down

    The euro managed to retrace a bit after reaching a three month low versus the greenback. It had its biggest daily gain in more than a week now, supported by the easing in the pessimism surrounding Greece. S&P raised Greece’s long-term credit rating from CCC- to CCC , believing that the risk of default was much lower for the coming up six to twelve months, and estimating a chance of Greece leaving the Eurozone at around 50% now. 

    Australia’s Consumer Price Index data came out close to expectations early on Wednesday, showing a change of 0.7%. RBA Governor Stevens, stated on Wednesday that future rate cuts are still a possibility. However, he warned that excessive easing could raise risk and cause excessive borrowing. Regarding the Australian dollar, Glenn Stevens noted that its lower adjustment is aligned with expectations and is impacting the economy in an expansionary way. Coming up tonight, the New Zealand Official Cash Rate and the RBNZ Statement due at 21:00 GMT. 

    Wall Street ended the day on Tuesday lower as it was driven by negative earnings results such as IBM’s, whose revenue dropped for a thirteen continuous quarter. The downside is expected to continue into Wednesday’s trading as shares like Apple, Microsoft and Yahoo dropped during after-hours trading since they released their earnings after the market closed. Apple shares were down almost 7% as earnings failed to meet the estimates and targets for iPhone sales. As a result, all three major US indices closed the session lower, with Dow Jones (USA30) being as much as 1% down. The US dollar was further weakened during Wednesday’s Asian session, down to 123.75 against the Japanese yen, causing the Dollar Index to move away from its three-month peak.






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