- Eurozone finance ministers studying possible 'bail-in' of Cyprus
- Goldman Sachs lowers view on equities to neutral
- Banks deposited 157.2bn euros overnight at ECB
FTSE Mibtel 30: -0.08%
Ibex 35: -0.40%
Stoxx 600: -0.27%
European stocks were seeing some slight selling pressure at the beginning of the day ahead of this evening´s meeting of the so-called Eurogroup. Eurozone finance ministers are expected to discuss the need - and possible modalities - of a bail-out of Cyprus and its banks. Also on the agenda may be the recent sharp moves in currency markets, especially ahead of this week´s meeting of G 20 finance ministers, where the matter is expected to be discussed.
Particularly worth noting, according to The Financial Times a radical new option (one of three being studied) for the financial rescue of Cyprus would force losses on uninsured depositors in Cypriot banks, as well as investors in the country's sovereign bonds. While such a solution may vex financial markets European leaders are described as weary of rescuing a banking system often seen as a money laundering centre for wealthy Russians.
Of interest, the recent rise in periphery sovereign risk premiums has had a dampening effect on investor demand for Southern European equities, the latest data from EPFR Global shows. Thus, such funds saw $264m in redemptions last week.
For its part, last Friday Goldman Sachs went neutral (from overweight) on global equities on a three month view, although it remains overweight on a 12 month view. According to their strategists, "Some US fiscal uncertainty remains and the European sovereign situation could deteriorate again, but we see risks as smaller than last year."
Speaking over the weekend however ECB council member Jorg Asmussen was cited as saying that an agreement on how to rescue Cyprus is likely by the end of the March.
On Friday ratings agency Fitch reaffirmed Spain´s long-term debt rating but also kept its outlook on the same at negative.
Novo Nordisk plummets
Novo Nordisk has failed to win approval from US regulatory authorities for a new insulin treatment as regulators seek to better assess heart risk. Shares of the company are now falling by 12%.
Dutch retailer Ahold has sold its 60% stake in Swedish supermarket chain ICA for approximately 20bn Swedish crowns ($3.1bn) to Hakon Invest.
Troubled Italian lender Monte Paschi di Siena is ready to clear the way to receiving €3.9bn ($5.2bn) in state backing in a "very short time", according to remarks from the Chairman.
From a sector stand-point the worst performers today are: Automobiles (-1.07%), Travel (-0.93%) and Oil (-0.67%).
Light data calendar
French manufacturing sector output increased by 0.1% month-on-month in December even if industrial production as a whole decreased by that same amount.
Other asset classes trading mixed
The euro/dollar is now edging higher by 0.25% to 1.3400.
Front month Brent crude futures are falling, by 0.321 dollars to the 118.52 dollar
level on the ICE.