FTSE -9 points at 7054
DAX -6 points at 11450
CAC -5 points at 4829
Eurostoxx -4 points at 3265
Monte dei Paschi has been rescued by the Italian government after falling short at raising 5 billion euros from private investors. Paschi’s shares and other securities have been suspended. The bank could raise capital through ‘precautionary capital increase’. On the other hand, the government's 20 billion-euro worth rescue program for Italian banks has been approved by the EU.
The Eurostoxx banks were flat at Thursday’s close (-0.05%).
The single currency gave little reaction to developments vis-à-vis Monte Paschi (MI:BMPS). After having shortly peaked at 1.0499, the EUR/USD bounced lower and consolidated between 1.0434/1.0452 in Asia. Traders remain seller on rallies, yet light option barriers stand from 1.0500 to 1.0700 at today’s expiry. Renewed positive momentum could temporarily send the pair into 1.0500/1.0550 mid-term resistance zone.
The EUR/GBP tested the 0.8500 mark on the upside. Broadly weakening pound is supportive of a further EUR/GBP rise to 0.8575/0.8585 (December resistance / 50-day moving average). Support is seen at 0.8400, the 200-day moving average.
The pound extended losses against the greenback. The GBP/USD slid to 1.2271 in Asia. The divergence between the Bank of England (BoE) and the Federal Reserve (Fed) monetary outlook, combined to lingering Brexit concerns continue weighing on the pound. Today, the UK will release the third quarter growth and current account balance. The UK GDP is expected to have expanded by 0.5% quarter-on-quarter, while the current account deficit may have narrowed from 28.7 to 28.2 billion pound in 3Q. Surprise softness in UK’s economic data could further weigh on GBP-crosses. The key support is eyed at 1.2080 against the US dollar, before the 1.2000 handle. Cable is expected to finish the year by 1.2300/1.2250.
The yen has been the biggest winner against the US dollar overnight. Japanese markets were closed due to holiday. Other Asian stocks edged lower on thin trading volumes. Shanghai’s Composite (-0.93%) and Hang Seng (-0.48%) remained offered. China’s wholesalers were the major losers, as profit margins are squeezed due to a stronger US dollar. Energy stocks and financials traded in the red.
European equity futures were mixed. European stock markets are expected to open softer this Friday.
The FTSE 100 is called 9 points softer at 7054 pence the open. The Euro Stoxx 50 is seen 4 points lower at 3265.