European markets higher on acquisition and tender news
Fiona Cincotta June 29, 2018 9:18 AM
The focus on European markets shifted this morning to major acquisitions, share buy backs from Swiss drug maker Novartis and in the case of BAE Systems, large tender news, for the moment leaving behind concerns over global trade disputes which have weighed them down over the past weeks. The FTSE 100 traded up 1% while the DAX and the CAC were up almost 1.3%, further helped by a boost in the euro.
The focus on European markets shifted this morning to major acquisitions, share buy backs from Swiss drug maker Novartis and in the case of BAE Systems, large tender news, for the moment leaving behind concerns over global trade disputes which have weighed them down over the past weeks.
The FTSE 100 traded up 1% while the DAX and the CAC were up almost 1.3%, further helped by a boost in the euro.
Stock markets in Asia started the day close to a nine-month low but with prices this weak some bargain hunting triggered a rally and they closed higher in Tokyo, Shanghai and Hong Kong.
Brexit fears and trade concerns stem consumer confidence
Brexit concerns and fears of a fully-fledged global trade war are taking their toll on consumer sentiment in the UK and domestic consumers and businesses are becoming increasingly more pessimistic about the prospects for the UK economy.
A survey by market researchers GfK showed an unexpected decline in June to -9 from -7 the month before, whereas it was widely expected that this indicator would hold steady.
A business confidence indicator compiled by Lloyds Bank showed a similar unexpected decline in June to the lowest level this year. The two items of data will contribute to the Bank of England’s next set of deliberations on interest rates and may nudge the Bank away from a planned interest rate hike in August.
Euro boosted by late night EU deal
The common currency was on the rise Friday morning after late night discussions between EU heads yielded a broad agreement on some of the key divisive issues including immigration and refugees.
The deal which now means that Italy will carry a heavier load in terms of refugees has taken pressure off German Chancellor Angela Merkel and her coalition which was on the verge of imploding over Germany’s role in the refugee crisis. The euro picked up against the pound to trade 0.27% higher and rallied even stronger against the dollar to trade up 0.55%.
StoneX Financial Ltd (trading as “City Index”) is an execution-only service provider. This material, whether or not it states any opinions, is for general information purposes only and it does not take into account your personal circumstances or objectives. This material has been prepared using the thoughts and opinions of the author and these may change. However, City Index does not plan to provide further updates to any material once published and it is not under any obligation to keep this material up to date. This material is short term in nature and may only relate to facts and circumstances existing at a specific time or day. Nothing in this material is (or should be considered to be) financial, investment, legal, tax or other advice and no reliance should be placed on it.
No opinion given in this material constitutes a recommendation by City Index or the author that any particular investment, security, transaction or investment strategy is suitable for any specific person. The material has not been prepared in accordance with legal requirements designed to promote the independence of investment research. Although City Index is not specifically prevented from dealing before providing this material, City Index does not seek to take advantage of the material prior to its dissemination. This material is not intended for distribution to, or use by, any person in any country or jurisdiction where such distribution or use would be contrary to local law or regulation.