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Today's Financial Focus

The level of disagreement between bankers and government officials who gathered for the annual IMF meeting was matched only by their shared sense that the stakes have rarely been higher. Bank-stock indexes in Europe and the US have dropped more than 30% this year and borrowing costs for European lenders have climbed amid concern that Greece and other European countries may default. US Treasury Secretary Timothy Geithner urged governments to unite with the ECB to increase the firepower of the fund, known as the European Financial Stability Facility.

European policy makers indicated they may use leverage, or borrowed money, to increase the spending strength of the EFSF. Klaus Regling, EFSF CEO, and German Finance Minister Wolfgang Schaeuble downplayed speculation that the fund might borrow from the European Central Bank or provide insurance on loans provided by the ECB directly to the private sector.

Greek Finance Minister Evangelos Venizelos said his country will do “whatever it takes” to meet its budget goals and cautioned against making it a “scapegoat” for the global economy.

MARKETS:

The Dow Jones Industrial Average suffered its biggest loss since 2008 last week as the Federal Reserve said risks to the US economy had increased and Europe’s debt crisis went unresolved.

ASIAN stocks fell today amid concern the European debt crisis may weaken economic growth. The MSCI Asia Pacific Index slid lower, and is set for its lowest close since June 2010. Japan’s Nikkei share average fell to a six-month low on Monday as it caught up with Wall Street losses after a three-day weekend, and amid declines for other risk assets on worries about a Greek default.

US FUTURES pared an early advance as world finance chiefs warned that a failure to contain Europe’s debt crisis poses “catastrophic” risk to the global economic outlook.

EUROPEAN shares are expected to open mixed ahead of a cautious trading today, with investors remain uncertain about the ability of finance chiefs to solve the Eurozone debt-crisis.

CURRENCIES:

The EURO slumped versus most of its major peers before a German report that may show business confidence in Europe’s biggest economy fell to a 15-month low, adding to signs the region’s economy is deteriorating. The 17-nation currency was 0.1% from a decade low against the yen as Greece awaits a decision on its next round of rescue funding.

ENERGY:

OIL traded near the lowest in more than six weeks in New York as investors speculated Europe’s sovereign debt crisis would cut fuel demand amid ample supplies. The European financial crisis and general fears about the global economy have weakened demand for crude, Qatari Oil Minister Mohammed Saleh al Sada said yesterday in Doha. Supplies are adequate and the nation is pleased that Libya is starting to produce and export oil, he said.

COMMODITIES:

Commodities fell for a fourth day and silver tumbled below $29 for the first time since February on speculation Europe’s debt crisis will worsen, curbing raw-material demand. Copper had its worst run since 2008.

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