Spreadex Market Update
Europe avoids immediate repeat of Monday’s traumatic trading despite scary Asian session
Managing a relatively surprising g 0.4% increase at the open, so far the FTSE is avoiding a repeat of yesterday, despite that rocky (yet still China-free) Asian session extending the atmosphere of fear that defined Monday’s trading. Compared to yesterday at least this morning there is a slither of data to help investors get through the day; expected to shrink from a deficit of £10.6 billion to £10.4 billion, Tuesday’s trade balance figure could help continue to calm the current choppy waters. Then again, the force of yesterday’s decline was rather alarming, so it may take something bigger to see a significant change in sentiment.
The Eurozone indices were immediately put on the back foot this Tuesday morning; coming in at -1.2% against the 0.2% forecast (and the -0.1% seen last month), Germany’s industrial production fell to lows not seen in 4 months. Yet the DAX, sitting at an effective 16 month nadir, and the CAC both saw relatively decent opens, rising around 30 and 15 points respectively, something of a win given the state of the Asian session.
The health of the German index this Tuesday may ride on Deutsche Bank’s performance; last night the company was forced to issue a statement saying it had ‘sufficient’ reserves to make payments on its Additional Tier 1 bonds, a move intended to reassure investors following its near 10% plunge on Monday. Already the bank has recovered around 1.5%, edging towards the €14 mark it fell below yesterday.
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