Spreadex Market Update
Single banking supervisor agreed?
After a meeting between 27 euro zone leaders at a Brussels summit it has been decided that a legal framework for the project should come into fruition by the end of this year giving the European Central Bank overall responsibility for banking supervision.
Once this is agreed, the single supervisory mechanism could probably be effectively operational over the course of 2013.
Whilst the euro was stable near a one-month high due to the progress made by European leaders on a banking supervision deal, Asian shares have declined on the back of poor preforming technology stocks, most prominently Google Inc. and Microsoft Corp.
The MSCI index of Asia-Pacific shares outside Japan dropped 0.3%, however the index is set for a weekly gain of about 1.7%. The yen did slip amid speculation that the Bank of Japan will ease monetary policy, weakening against 13 of 16 major peers and was down 0.1% to 103.66 per euro.
Taking a look at Google, we can see that the latest quarterly results have fallen well short of what Wall Street was expecting after its core advertising business slowed.
This was an unwelcome shock to investors who are so used to seeing consistent growth in the stock.
More than 9% was wiped from the value of Google.
Another contributing factor the Google current slump is the continuing failure of its recently acquired mobile phone business Motorola Mobility.
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