Currencies

Weak jobs data set the market off again as a US mortgage lender went under and Bear Stearns fuelled the pessimism.

The Dow posted its second consecutive rally last night – the first time it has put two up-days together in three weeks.

Wall Street traders could be forgiven for feeling nauseous at day’s end following a session dominated by extreme volatility, culminating in a strong rally in the final twenty minutes.

Early strength on Wall Street was killed off last night as a large mortgage lender announced trouble and the Fed declared the market was on its own.

Late buying in the Australian market was reflected on Wall Street as the Dow, too, opened lower but closed higher.

The pattern has been broken as the Dow fell another 200 points on Friday despite a strong economic growth number. The Aussie continues to be slaughtered.

The Aussie dollar was pushed sharply lower overnight but according to Westpac Bank its uptrend against the US dollar should soon continue with US92c a year-end target.

Goldilocks fled the scene last night as exceptionally poor housing data finally overshadowed any earnings reports and credit contagion ruled the day. Carry trade unwinding began in earnest stripping more than a cent off the Aussie.

A spectacular result from Amazon headed the positives on Wall Street last night as growing LBO disquiet and very poor housing data reinforced credit market problems. Goldilocks was ahead on the day.

The Dow was down 227 points last night as America’s biggest mortgage lender reported a 35% fall in profit, and it wasn’t all because of subprime.