\n\tBy Greg Peel<\/p>\n
\n\tThe Dow closed down 24 points or 0.2% while the S&P lost 0.2% to 1329 and the Nasdaq<\/span> dropped 0.9%.<\/p>\n \n\tWall Street staged one of its spectacular last-hour recoveries last night, with the Dow turning around from down 177 points at around 3pm<\/span>. The turnaround was credited to a late headline from Brussels, but supposedly driven by a couple of very big S&P orders hitting the market. Wall Street had fallen heavily from the open on an unpopular Supreme Court ruling and kept drifting away as there seemed no signs of agreement at the EU summit.<\/p>\n \n\tThe summit is scheduled for two days, so there was some risk in assuming no good news last night meant no good news period. It appeared, nevertheless, that the two sides (being Germany vs The Rest) were deadlocked. But late in the New York session, on the close of the European session, reports suggested leaders had agreed to spend E120bn<\/span> to stimulate eurozone<\/span> growth and create jobs.<\/p>\n \n\tEarlier in the day it was announced the US Supreme Court had upheld President Obama's healthcare reform act as not being unconstitutional. This did not go down well with a Republican-biased Wall Street, which sees “Obamacare”<\/span> as an affront against the free market mantra. As an attempt to introduce some form of universal health insurance, Obamacare<\/span> represents the sort of spending and taxes the Republicans are defiantly resisting. The sell-off was largely sentimental nevertheless, given listed hospitals – beneficiaries of Obamacare<\/span> – were also sold.<\/p>\n \n\tMit<\/span> Romney called the court decision a mistake and vowed to repeal Obamacare<\/span> the moment he became president. Let the real battle now begin.<\/p>\n \n\tThe initial sell-off also came in the face of a good result last week on US new jobless claims, after a series of increases, and after the final revision of March quarter GDP left the growth number unchanged at 1.9%. A similar final revision was made in the UK, which confirmed a March quarter of 0.3% contraction. The December quarter result was downgraded to 0.4% contraction, and there remains no doubt Britain has hit a “double dip” recession on the technical two-quarters measurement.<\/p>\n \n\tOne assumes there will be more specific news from Brussels, either during our session today or after the second day of talks tonight. Whether or not an E120<\/span> growth package is any sort of panacea, well, one presumes it shan't be seen as one, but we'll wait to see what else transpires.<\/p>\n \n\tPrior to the late Wall Street turnaround it had been very much another “risk off” session. Funds flowed into the US dollar, and despite another E120bn<\/span> representing further devaluation of the euro, nervous investors dumped gold yet again as insurance against potential margin calls. Gold attempted a late recovery, but failed, falling US$22.20 to US$1552.00\/oz. The US dollar index is up only 0.2% to 82.74, while the Aussie is off 0.4% to US$1.0039.<\/p>\n \n\tCommodity markets all closed before the late Wall Street rally, so we have Brent down US$2.14 to US$91.36\/bbl<\/span> and West Texas down US$1.79 to US$78.42\/bbl<\/span>. Base metals were mostly weaker, but held up pretty well under the circumstances.<\/p>\n \n\tUS bonds again became a safe haven, with the ten-year yield down 4bps<\/span> to 1.57%, but there remains little sign of panic or even fear in the VIX<\/span> volatility index, which remains at a comfortable 19.<\/p>\n \n\tThe SPI<\/span> Overnight fell 8 points or 0.2%<\/p>\n \n\tIt's the last day of the financial year locally and the close of the quarter\/half in the US tonight. Somewhere amidst that muddle we will presumably hear more out of Brussels. European leaders know they can't leave Brussels in stalemate, as this would be a final straw for global markets. As to what else they can agree upon is nevertheless another matter.<\/p>\n \n\tIf your stockbroker seems a bit slow this morning – or should I say slower than usual – he or she might just be a little weary after last night's annual charity fundraiser and Stockbroker Awards dinner. Speak softly.<\/p>\n