Spreadex Market Update
Gains for Shire boost FTSE despite RSA collapse; Volkswagen deceit drags down DAX
The FTSE, somewhat against the odds, was up around 30 points at the open, lifted by a decent morning for its commodity stocks and a near 3% jump for Shire, which was just given permission by the European Commission to market its non-stimulant ADHD drug INTUNIV, already a major seller in the US, in Europe. However, despite a strong morning for the FTSE it wasn’t all good news for the index’s components, as RSA Insurance fell afoul of the curse of M&A, with Zurich Insurance dropping its takeover bid after it was forced to forecast a $200 million loss due to the Tianjin port explosions earlier in the year.
The Eurozone was more of a mixed bag; by and large the region opened with some decent gains, with the CAC up around 40 points at the open, following yet another Syriza victory in the Greek election that ostensibly secures the continued implementation of the measures agreed in the latest bailout.
The DAX, however, was the black sheep of the Eurozone, struggling to lift-off this Monday due to a mixture of worse than expected PPI data and, more importantly, a colossal 15% fall by Volkswagen after it admitted some rather naughty behaviour in regards to using software to produce false emission data in its diesel cars. With VW having to recall around half a million cars, something that could lead to a potential $18 million fine, investors fled the German giant, preventing the DAX from joining in with the morning fun in the process.
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