INGOT Brokers Australia | European Market Report (2017-06-28)

European Market Report (2017-06-28)

European equity markets recorded an upside down session closing at a two month low after the rally in the euro and the British pound due to the recent comments by the policy makers in the ECB Forum on central banking in Portugal.

The euro climbed from $1.12 on Tuesday after Draghi said in a speech that “a considerable degree” of stimulus is needed in the Eurozone, a step back from the more dovish language used in earlier speeches. A stronger euro can hurt shares of European exporters on the prospect that it could cut into sales of goods to overseas clients. In today’s session the euro reached a 1 year high to hit $1.1390 after declining to an intraday low of $1.1292 following reports that ECB officials said the markets had misjudged comments made a day earlier by ECB President Mario Draghi.

Moreover, the pound has seen a very positive trend in today’s session climbing to 1.2972 against the dollar after Governor of the Bank of England, Mark Carney, has triggered a rise in the value of Pound Sterling with the clear-cut suggestion that UK interest rates would need to rise soon.

 

FTSE 100

U.K equities had been trading lower during the session but were hurt further as the pound popped up above $1.2900 for the first time since the U.K.’s general election earlier this month resulted in a hung parliament. The FTSE 100 declined 0.6 percent to close at 7,387.8.

A higher pound can put pressure on earnings overseas by multinational companies that make up a large share of the FTSE 100. The pound soared after Bank of England Gov. Mark Carney said the case for raising U.K. interest rates could be made if wage growth and business investment increase, even if consumer spending is weak.

Carney made his comments at the ECB’s forum on central banking in Portugal, where Draghi and Bank of Japan Gov. Haruhiko Kuroda, also appeared.

DAX 30

Germany equity markets closed Tuesday’s trading session in red, pressured by the losses in the Utilities, Basic Resources and Software sectors, the DAX ended down by 0.19 percent to close at 12,647.27.

The best performers of the session on the DAX were Lufthansa AG VNA O.N. which rose 3.57% or 0.690 points to trade at 20.030 at the close. Meanwhile, Commerzbank AG O.N. added 3.21% or 0.319 points to end at 10.260 and Deutsche Bank AG NA O.N. was up 1.42% or 0.220 points to 15.740 in late trade.

The worst performers of the session were RWE AG ST O.N. which fell 2.36% or 0.435 points to trade at 17.965 at the close. E.ON SE NA declined 1.28% or 0.111 points to end at 8.574 and Henkel & Co KGaA AG Pref was down 1.20% or 1.50 points to 124.00.

 

CAC 40

France equities declined in today’s trading session after the losses in the Healthcare, Consumer Goods and Industrials sectors, the CAC ended down by 0.1 percent to end at 5,252.90 points.

The best performers of the session on the CAC 40 were BNP Paribas SA which rose 2.68% or 1.68 points to trade at 64.33 at the close. Meanwhile, Societe Generale added 2.46% or 1.17 points to end at 48.47 and ArcelorMittal SA was up 1.59% or 0.310 points to 19.865 in late trade.

The worst performers of the session were Unibail Rodamco SE which fell 1.92% or 4.40 points to trade at 225.35 at the close. Essilor International Compagnie Generale d’Optique SA declined 1.85% or 2.15 points to end at 114.30 and LVMH Moet Hennessy Louis Vuitton SE was down 1.37% or 3.15 points to 226.65.

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