- Equities bounce back in early trade
- Single currency higher, above 1.36
- Analysts shave estimates for bank LTRO repayments
FTSE Mibtel 30: -0.39%
Ibex 35: -1.83%
Stoxx 600: 0.21%
European equities are holding higher although they are off their best levels of the day as financials weigh on the Madrid and Milan bourses. On the former the market regulator has today repealed the ban on short-selling financial stocks. Meantime, and in Italy, investors have taken note of S&P´s decision to downgrade the rating of lender Monte dei Paschi di Siena.
That comes ahead of the release of a barrage of economic indicators, Stateside, this afternoon, including the all-important monthly employment report.
Also weighing on markets is the news that European banks are expected to pay back a smaller-than-expected amount to the European Central Bank (ECB) next week as part of the repayments for the Long-Term Refinancing Operations (LTRO) programme. Banks will repay €3.5bn to the ECB, below the €20bn forecast and well under the €137bn paid last week.
'Traders are now tempering their earlier optimism about the overall state of the banking sector which may not be as healthy as thought last week,' said market strategist Ishaq Siddiqi from ETX Capital.
Acting as a backdrop, the US Senate last night approved the extension of the country´s debt ceiling. Chinese data out overnight, on the other hand, came in a tad mixed.
Not to be lost sight of, the single currency has climbed atop the 1.36 dollar
barrier overnight, continuing with its recent quick trend to the upside.
Home appliances maker Electrolux´s core operating profit for the fourth quarter was hit by falling European sales.
Spanish lender BBVA has reported a 44% fall in its yearly net profit.
French bank Credit Agricole has warned that its fourth quarter results will be hit by €3.8bn euros ($5.16bn) in writedowns linked to poorly timed acquisitions.
From a sector stand-point the best performance is now to be seen in the following industrial groups: Technology (1.92%), Media (1.09%) and Automobiles (0.85%).
Eurozone PMI at 11 month high
The Eurozone´s purchasing managers´ index for the month of January has come in at 47.9 versus a reading of 46.1 for the month before (Consensus: 47.5).
Italian unemployment rose to 11.2% in December, up by a tenth of a percentage point versus the previous month, albeit in-line with expectations.
Eurozone CPI data for the month of January is due at 10:00, along with the latest unemployment data for the single currency area.
Euro continues to move higher
The euro/dollar is now sitting atop the 1.36 mark, up by 0.46%, at 1.3650.
Front month Brent crude futures are now down by 0.043 dollars to the 115.5 dollar level on the ICE.