London Session - August 31, 2009 7:45 AM

Risk aversion remained the name of the game in London as news out of China once again led equity marts lower. Reports that Chinese state-owned companies will be allowed to default on commodity derivative contracts created quite a stir and raised concerns about counterparty risk. Chinese shares plunged nearly 7% as a result. The ripple effect saw European bourses come off about 1% thus far while US futures remain in the red as well. The move away from risk helped the US dollar remain better bid, while the yen crosses remained heavy following the widely expected Japanese election results. Full text »