Market Commentary and Intraday News

European Markets Fall As Eurogroup To Meet Amid Spain, Greek Concerns

252 days ago

(RTTNews) - The European markets are moderate to notably lower in afternoon trading Monday, ahead of a meeting by European finance ministers to discuss the region's debt crisis. The Asian stocks fell and the U.S. index futures point to a lower open.

The Eurogroup, an informal gathering of the Finance Ministers of Eurozone, is set to meet in Luxembourg on October 8 before the full meeting of the ECOFIN Council on the next day. German chancellor Angela Merkel will visit Athens on Tuesday in support of Greece's reform efforts.

Greece is racing against time to secure a deal with the troika, comprising the International Monetary Fund, the European Union and the European Central Bank, on the 13.5 billion euros of austerity measures.

Spain and the reform efforts by the government so far will likely be among the main topics coming up for discussion, apart from deliberations on an EU-wide banking union.

Germany's exports grew unexpectedly in August as declining shipments to euro nations were offset by higher demand from other countries, which further lifted hopes of growth in the largest Eurozone economy, data from Destatis showed.

Germany sold its 6-month treasury bills known as Bubills at negative yield on Monday as safe-haven demand recovered amid the lingering uncertainty over a Spanish bailout request, auction data from Bundesbank revealed.

The country raised 2.420 billion euros from the sale of its April 2013 treasury discount paper against a target of 4 billion euros. The bid-to-cover ratio, which reflects demand, rose to 2.3 from 1.5 last month.

Meanwhile, investor confidence in Eurozone improved for a second consecutive month in October, but remained below economists' forecasts, data released by think-tank Sentix revealed. The Sentix Index rose to -22.2 in October from -23.2 in September. Economists had forecast an improvement in the reading to -20.9.

The Euro Stoxx 50 index of eurozone bluechip stocks is losing 1.24 percent, while the Stoxx Europe 50 index, which includes some major U.K. companies, is falling 0.75 percent.

The German DAX is losing 1.3 percent and the French CAC 40 is falling 1.20 percent. The UK's FTSE 100 is sliding 0.5 percent and Switzerland's SMI is dropping 0.31 percent.

In Frankfurt, Commerzbank is losing 2.3 percent and Deutsche Bank is down 1.4 percent.

Lanxess is dropping 2 percent. Tire firm Continental is falling 1.8 percent.

Daimler is losing 1.9 percent while BMW and Volkswagen are moderately lower.

Metro is declining 3.1 percent. Exane BNP cut the stock to "Underperform" from "Outperform."

Axel Springer is declining 4.4 percent. HSBC reduced its rating on the stock.

Franco-Dutch airline Air France-KLM Group is partnering with UAE's Etihad Airways and Airberlin to cover more destinations through mutual code-share agreements. Air Berlin shares are advancing over 2 percent while Air France shares are gaining 1.4 percent in Paris.

In Paris, Societe Generale, Credit Agricole and BNP Paribas are declining between 2.3 percent and 1.5 percent.

Saint-Gobain is dropping 3 percent. Carmaker Renault and metal fabrication firm Vallourec are losing 2.5 percent each.

Bucking the trend, department store operator PPR is gaining 2.4 percent.

In London, Evraz is declining 5.4 percent. Vedanta and Eurasian Natural Resources are losing 3.8 percent and 3.6 percent, respectively.

Barclays is losing 2.3 percent and Royal Bank of Scotland is falling 2.2 percent.

Imperial Tobacco is falling 2.1 percent after it was downgraded by Nomura.

Cookson Group is declining nearly 14 percent after the materials science company said its full-year performance as a whole is now expected to be materially below the board's previous expectations.

Specialist recruitment consultancy Michael Page expects full year operating profit to be slightly below current analyst expectations, owing to challenging conditions. The stock is falling over 1 percent.

Hennes& Mauritz is losing 0.6 percent in Stockholm after a broker downgrade.

Life insurer Aegon is losing 2.1 percent in Amsterdam. Nomura cut the stock to "Neutral" from "Buy."

Asian stocks ended mostly lower on Monday, with commodity-related stocks coming under selling pressure. Australia's All Ordinaries fell 0.26 percent and Hong Kong's Hang Seng dropped 0.9 percent. China's Shanghai Composite Index, which opened after a week-long holiday, dropped 0.6 percent.

In the U.S., futures point to a lower open on Wall Street. In the previous session, the major averages pulled back well off their early highs, ending the session mixed. The Dow gathered 0.3 percent, while the Nasdaq slid 0.4 percent and the S&P 500 edged down less than a tenth of a percent.

In the commodity space, crude for November delivery is falling $1.38 to $88.50 per barrel and December gold is losing $9.8 to $1771.0 a troy ounce.

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