European markets start with small gains – data eyed
City Index January 24, 2011 8:21 PM
<p>European markets started the new week with small gains as stronger miners balanced out a weaker opening for UK banks. Investors are likely to focus […]</p>
European markets started the new week with small gains as stronger miners balanced out a weaker opening for UK banks.
Investors are likely to focus more on economic data than company earnings this week. The amount of firms yet to report across the pond that moves the market is now much less and this week we have economic data of real importance including EU manufacturing, UK GDP, US GDP and rate decisions both from the Bank of England and the Federal Reserve. With this in mind, it may be a rather slow start to the week until we get into the depths of the data due out.
It is the stronger mining sector that is keeping European Indices afloat this morning, as much of their gains is helping to counter weigh weakness in the banks and tech stocks. We have Copper prices rallying 1% higher and this has given correlated strength to buyer demand for mining stocks.
On the downside however it is banking stocks that are a key drag on Indices, with Royal Bank of Scotland the worst performing equity on the FTSE 100, falling 2.7% as investors react to Vickers’ speech on banking reform and lock in profits from Friday’s strong move higher when its shares rose near 6% on speculation of an early exit from the Asset Protection Scheme.
In wider European equities, Philips was also a key drag after the electronics firm reported a lower than expected fourth quarter net profit and warned that consumer sentiment will continue to be subdued this year. The firm reported net profit of €465m, way short of market consensus with the majority of investors expecting a figure closer to €530m. Due to actual profit figures falling such a long distance away from market expectations, investors have moved quickly to sell their holdings in the electronics firm whose shares have subsequently fallen over 6% in early trading.”
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