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THE MARKETS IN some parts of Europe have rallied slightly over the course of this morning following a disastrous opening which has had the world watching on and wondering what it’s all going to mean in the long run.
After US markets closed badly yesterday and Asian markets also took a tumble overnight, Europe followed suit, opening badly with most major indexes suffering losses of over 2 per cent.
At present, stocks are down in France where the CAC 40 index of shares is down 0.32 per cent.
In Germany the DAX is down 1.77 per cent whilst in the UK there is little sign of the FTSE rallying off the back of big losses yesterday, it’s down 2 per cent at the time of writing.
There has been some good news this afternoon with the Ibex in Spain up 1.19 per cent at the time of writing whilst in Italy the MIB is up 1.06 per cent.
The ISEQ index of Irish shares is down 1.17 per cent.
All eyes are also on the yield of 10-year bonds in Italy and Spain which are at 6.13 per cent and 6.03 per cent respectively.
Anything above 6 per cent is viewed with some trepidation internationally given Ireland, Greece and Portugal all sought international assistance when the yield on their 10-year bonds went above 6 per cent.
The Guardian reports that the rumour is that the country’s own central banks are buying their national bonds in order to keep the yield down. It had gone higher than present levels in recent days.
The EU’s top economic official Olli Rehn admitted the obvious in a press conference this afternoon: “Markets have not reacted as we expected or hoped for to the measures agreed by euro-area Heads of State and Government on 21 July,” referring to the agreement reached on the European Financial Stability Facility and the second bailout for Greece which was anticipated to dampen market fears for a longer period than it has.
With the markets opening in the US at 2.30pm Irish time, it is looking increasingly likely that there will be plenty of brokers with hands on their faces.
You can track the latest stock prices on on Bloomberg.
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