Choppy trading in Europe as miners drag Indices lower | Traders watch Middle East events
City Index October 4, 2012 3:28 PM
<p>European markets were dragged lower by weakness in heavyweight mining stocks on Thursday in choppy trading. Financials however found support after the European Banking Authority […]</p>
European markets were dragged lower by weakness in heavyweight mining stocks on Thursday in choppy trading. Financials however found support after the European Banking Authority said European banks had raised €205 in new capital to shore up their finances.
By 10am, the FTSE 100 was trading lower by 14pts at 5811 whilst the German and CAC indices also lost 0.3%.
The miners have been a key drag on European markets with the FTSE 350 mining sector losing the most in trading, falling 1.2%, closely followed by oil stocks who are playing catch up to the 4% slump in the price of oil yesterday.
Traders are eyeing developments in the Middle East too, where continued instability in Syria is seeing investors vacate oil stocks on production concerns in the broader region. This, alongside speculation that the next tranche of loans to Greece will be delayed until November is keeping investors on the back foot.
We have interest rate and QE decisions to come from the Bank of England at noon and the European Central Bank at 12.45pm. No movement is expected in either decision, though naturally investors remain somewhat cautious in case of any surprises from both central banks.
US factory orders are expected to slump -6% in August and so this could well be a somewhat sensitive piece of economic data in the afternoon session, whilst we also have the FOMC minutes released after the close of European trading.
With US non-farm payrolls due out tomorrow, there is a degree of trader positioning taking place today, with traders looking to diversify ahead of the jobs release tomorrow which typically brings about some added price volatility.
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