- US considers raising debt ceiling
- Draghi reaffirms vow to keep interest rates low
- Royal Mail share sale begins
FTSE 100: 0.31%
CAC 40: -0.19%
FTSE MIB: -0.04%
IBEX 35: -0.24%
Stoxx 600: 0.14%
European stocks were mixed after the US House of Representatives offered President Barack Obama a short-term debt limit increase to avoid a default.
In a major breakthrough yesterday, House Speaker John Boehner said he would offer a measure to postpone a potential US default to November 22nd after leaders met for 90 minutes at the White House.
Congress must raise the $16.7trn borrowing limit by October 17th or it will run out of cash to pay its bills.
"The implications for the next six weeks, however, are less positive, simply delaying the issue could lead to further volatility in the markets with both sides seemingly unwilling to budge up until this point, only the possibility of global economic Armageddon and the pressure of public opinion has forced the Republics to temporarily yield," according to Alex Conroy, Financial Sales Trader at Spreadex.
"The egregious failure of bi-partisan politics throughout this ordeal suggests this decision and apparent willingness to deal by the Republicans should be taken with a grain of salt."
The government went into partial shutdown on October 1st after failing to approve a budget as lawmakers clashed over Obama's controversial health care bill.
European Central Bank President Mario Draghi said yesterday the prolonged US debt stalemate could hurt the global economy.
He also reaffirmed his vow to keep interest rates low, saying it would allow for cuts in borrowing costs if market volatility resumes.
"The Governing Council has unanimously agreed to incorporate an easing bias that explicitly provides for further rate reductions, should the volatility in money market conditions return to the levels observed in early summer," Draghi said at the Economic Club of New York yesterday, according to Bloomberg.
Draghi, who said economic recovery remains subdued, uneven and fragile, had made the pledge in July to maintain official interest rates at or below current levels for "an extended period".
Royal Mail begins stock market debut
Royal Mail's shares
jumped as the UK postal service raised £1.7bn in an initial public offering on the back of high demand from investors.
Danish cancer drug developer Genmab advanced after saying its ofatumumab drug showed a significant reduction in cumulative number of new brain lesions in a multiple sclerosis study.
Geberit fell after Goldman Sachs cut its rating of the Swiss maker of toilets and bathroom-piping systems to 'sell' from 'neutral'.
French computer-services company Cap Gemini rallied after industry peer Infosys raised its sales forecast.
The euro rose 0.28% to the 1.3558 US dollar.
Brent crude futures fell $0.188 to $111.590 per barrel on the ICE.