Euro hit, stocks in technical bounce - Sky News Australia

Updated: 13:34, Friday May 25, 2012

The euro has hit near-two-year lows as European and US data offered little light in the gloom and an EU summit failed to come up with any fresh remedy to reassure investors over Greece's future.

Dealers said a sharp technical bounce for stocks on Thursday followed heavy losses on Wednesday, but the the gains were vulnerable in the absence of a news lead.

European surveys indicated the economy slowing sharply across the board while the latest US jobs numbers showed no marked improvement in hiring, the key development needed to increase demand and get the economy moving again.

In mid-afternoon trade, the European single currency was at $US1.2570, coming off an early low of $US1.2516, levels last seen in July 2010 and down from $US1.2582 in New York late Wednesday.

Capital Economics analysts said they believed the euro has further to fall.

'Even after the recent falls, the euro exchange rate does not appear to incorporate a significant 'break-up premium'. As suc