Australia: Bad news was really the theme of overnight trading which not only saw the AUD weaken but equity markets retreat as well. The European debt crisis consumed the first half of the trading session as reports came out that Greece's had approached the European Union and the International Monetary Fund for a restructuring of its debt. If this didn't hurt the markets enough, later in the trading session Standard and Poor's lowered its long term outlook for the United States sovereign debt from it's current level of "stable" to "negative".

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Their main concern is the medium - long term fiscal challenges that are currently being experienced in the US. This has come as a major surprise to the market, which can help explain the reaction of investors. The DOW and the S&P500 both finished lower 1.1% at 12202 and 1305 respectively. Today is Australia sees the release of the RBA's Board Minutes for April which will be closely watched by investors. While it is unlikely to be a market mover today, many will be interested to see whether there are any changes to their recent minutes which state that the RBA is comfortable with its current policy setting.

Majors: The EUR/USD suffered its largest one-day drop in nearly five months as the debt crisis continues to plague the region. As mentioned above, the reports that Greece is seeking assistance in restructuring its debt saw the EUR in a massive sell off losing 70bps in a matter of minutes.

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The past few months have seen the EUR/USD rally on the back of expected interest rate hikes, but the concerns over Greece outweighed this overnight, with the EUR/USD opening this morning at EUR1.4200. While the JPY was initially battered with the reports released overnight, safe haven flows saw it recover firming above USD82.30, as investors moved away from the EUR and USD. The recent strength of the JPY has been a huge surprise to the market since they continue to recover from their recent natural disasters.

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