Sinking mining stocks and apprehension over decisions over eurozone bond aucitons lower FTSE
City Index September 11, 2012 5:20 PM
<p>- Sinking mining stocks and apprehension over decisions to be made this week over eurozone bond buying have dragged the FTSE down 17 points this […]</p>
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- Sinking mining stocks and apprehension over decisions to be made this week over eurozone bond buying have dragged the FTSE down 17 points this morning to 5777. Unease and its potential implications for Spain have also led Germany and Spain to follow suit down 14 and 21 points at 7200 and 3490. Over in the states Wall Street closed last night down 7 points at 13300.
- Now, the root cause of this eurozone apprehension is Germany’s constitutional court ruling later this week whether its government’s backing of the already delayed bailout fund – or European Stability Mechanism as it is officially known – is legal, the result of which will initially have the most direct effect on Spain and its ability to raise funds through bond auctions.
- Taking a more microeconomic view Burberry has come off a massive 19% after announcing a stark drop off in sales in recent weeks and that none of its 6% Q2 sales increase came from comparable store sales. The company went on to lower its expected pretax profit for this financial year leading various banks including Nomura to cut price targets for the luxury retailer and cut them to hold from buy.
- Lastly, watch out for trade balance announcements today in the UK and USA with ours having come in nearly 2billion better than expected at -7.1bn and the US to announce theirs at 1:30pm.
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