Spread Betting Markets Lifted by Optimism Over EU Debt Crisis Outcome
|
|
|
For today's update see Spread Betting Daily.
The Daily Update from Anthony Grech, Research Analyst, IG Index.
Spread Betting 27 September 2011: 10.45am Update
The FTSE 100 surged this morning as investors took comfort from speculation that Eurozone officials will find a way to stem Greece's debt crisis and alleviate the risk of contagion.
By 10am (London time) the FTSE 100 had gained 2.12% to 51927.10, while the FTSE 250 jumped 2.03% back above the 10,000 level to 10,038.89. European markets also continued to rise with the DAX and CAC surging over 3%.
Greece votes on further austerity
Greece will face a key vote in parliament today amid growing fears that discontent within the ruling party could force a change in government.
The vote on a property tax law is expected to pass by a narrow four-seat parliamentary majority, and comes as Greece scrambles to secure fresh aid in an attempt to avoid default. The property tax law is hoped to help plug a gap of €2 billion in this year's budget. The vote is scheduled to take place at 5pm (London time).
Without parliamentary approval for the new austerity measures, Greece may not be able to secure further funding from its creditors, who are demanding proof that the government will keep its promises after failing to implement earlier commitments.
At stake is an €8 billion bailout payment from the Troika, which Greece needs within weeks to avoid entering a default. Greece has vowed to do what it takes to get the next tranche and announced on Monday that it may close concession deals as part of its €50 billion privatisation plan, another key condition for bailout aid.
During the vote on the tax bill, Prime Minister George Papandreou will attend a meeting in Berlin with Chancellor Angela Merkel. Mr Papandreou will discuss reforms ahead of another parliamentary vote in Germany on Thursday, which aims to give more aid to the European Financial Stability Facility emergency bailout fund.
German consumers remain calm
Economic data released this morning suggest that German consumers are untroubled by the escalation of the Eurozone sovereign debt crisis and its possible impact on the global economy.
Despite the rising fears of a recession, the forward-looking consumer climate index remained unchanged in October. The index is came in at 5.2 points for October, steady from an unrevised 5.2 points in September, which beat economists' forecasts of a reading at 5.0.
Additionally, the sub-indices of the overall consumer climate index showed Germans' economic expectations deteriorated further in September, after a collapse in August, as consumers expect economic performance to weaken. The economic expectations index fell sharply to 4.8 points in September, down from 13.4 points in August and 44.6 points in July.
Commodities rise
Commodities continued to rise for a second day as speculation strengthened over European policymakers intensifying their efforts to contain the region’s debt crisis.
Copper spreads rebounded from a 14-month low and were up over 3% this morning, to $338.60 per pound. Crude oil futures also jumped, with light-sweet crude oil for November delivery up almost 3% to $82.63 per barrel and Brent crude oil for November delivery up almost 25% to $105.83 per barrel.
Gold prices on the other hand remained volatile, surging almost 5% this morning to $1672.40 per ounce, with commodities spread betting investors continuing to question its ‘safe-haven’ label. Gold’s cheaper cousin, in contrast, was almost 9% up at $32.62.
US pre-market
US markets appear to remain optimistic today with Dow futures up 0.81% and S&P 500 futures 0.85% higher.
On the economic front today is the US consumer confidence index, which is expected to edge up in September to 46.0 from 44.5 in August, while the Richmond Fed’s manufacturing index is expected to worsen slightly, dropping to -12 in September from -10 in August.
Both are due for release at 3pm (London time). At 5.30pm (London time) Federal Reserve policymaker Dennis Lockhart is due to speak on the US economy.
Remember that financial spread betting is a leveraged product and can result in losses that exceed your initial deposit. Spread betting may not be suitable for everyone, so please ensure that you fully understand the risks involved.
The above comments do not constitute investment advice and neither IG Index nor SpreadBets.org.uk accept any responsibility for any use that may be made of them.
Advert:
IG Index Spread Betting - No Fees, No Commissions, Free Charts and Live Prices.
Spread Bet on Indices, Forex, Commodities, Shares and more. For details see IG Index.
|
Spread Betting 27 September 2011: 6.15am Update
In the US overnight, stocks staged a significant relief rally, led by financial and energy names amid reports that European officials were working on a TARP-like plan to contain the Eurozone’s debt crisis.
The Dow Jones Industrial Average was the top performer - rising 2.5% - while the broad-based S&P 500 and NASDAQ rose 2.3% and 1.4% respectively.
Asia & Australia
Across Asia, regional markets are all sharply higher following the strong rebound rally seen in overnight trade, amidst renewed hopes the latest plan European officials are working on will help ease the debt crisis. The Kospi is the best performer - up 4.1% - while the Shanghai Composite, Nikkei 225 and Hang Seng are all up between 0.5% and 2.5%.
In Australia, the ASX 200 is seeing strong, broad-based gains as yesterday’s big intraday falls - especially among the materials space - are reversed. The S&P/ASX200 is 3% higher at 3979, just off session highs of 3990.
Not surprisingly, it’s the heavily weighted materials, energy and financial sectors that are adding the bulk of the points. They are all up more than 3.4%.
Elsewhere, consumer discretionary and industrial names are adding significant points while the defensive sectors are bringing up the rear.
Looking ahead, sentiment in equity spread betting markets changed markedly just after the European close last night, with traders suddenly becoming increasingly confident that European leaders can now reach an agreement to successfully contain the debt crisis.
With stock prices decimated in recent days, this was sufficient to see the bargain hunters flood back into the market, leaving the Dow to add over 270 points by the close, and pacing Asian trade too.
Europe
As a result we're looking at some big upswings in Europe ahead of the open, although sustaining these gains - and ensuring we can continue to grind higher - will rely on two key points.
Investors must hold their nerve and at the same time central banks and finance ministers need to remain 'on message', as any suggestions that the rescue plans may go awry will likely be enough to see financial spread betting markets take fright once again.
After a quiet start to the week, the fundamentals pick up a little more today, with US consumer confidence and the UK CBI reported sales data - both for September - both on the economic calendar.
There's also a flurry of activity amongst smaller consumer plays in London today, with numbers expected from the likes of Game Group, Moss Bros and Topps Tiles. But it's that big turnaround in opinion on the major macroeconomic story of the day that is set to dominate where we go next.
Ahead of the open we're calling the FTSE up 99 at 5188, the DAX up 84 at 5430 and the CAC up 46 at 2905.
Remember that financial spread betting is a leveraged product and can result in losses that exceed your initial deposit. Spread betting may not be suitable for everyone, so please ensure that you fully understand the risks involved.
The above comments do not constitute investment advice and neither IG Index nor SpreadBets.org.uk accept any responsibility for any use that may be made of them.
Advert:
IG Index Spread Betting - No Fees, No Commissions, Free Charts and Live Prices.
Spread Bet on Indices, Forex, Commodities, Shares and more. For details see IG Index.
|
"Spread Betting Markets Lifted by Optimism Over EU Debt Crisis Outcome" last update by AG, 27-Sep-2011
Warning: Financial spread betting carries a high level of risk. You can lose more than your initial investment or stake. Financial spread betting may not be suitable for all investors. Only trade with money that you can afford to lose. Make sure you fully understand the risk involved. If necessary, seek independent financial advice.
Similar articles:
Spread Betting Daily - last update: 23-May-2012
Your daily spread betting update from the insiders. A look at the FTSE 100 and a range of other spread betting markets from Crude Oil to Shares to Gold to . . . read more Spread Betting Daily.
Spread Bets Daily Markets - last update: 22-May-2012
Spread Betting Daily News - A daily trading update from IG Index. Every weekday the experts offer their view of the markets . . . read more Spread Bets Daily Markets.
FTSE 100 Spread Betting Index Falls amid Poor Eurozone PMI Data - last update: 04-May-2012
Markets were back in risk-averse mode this morning following a string of weaker-than-expected PMI services figures from the Eurozone. By 10.45am (London time) the FTSE 100 spread betting index was 0.75% lower . . . read more FTSE 100 Spread Betting Index Falls amid Poor Eurozone PMI Data.
Spread Betting: Successful Spanish Bond Auction Sees UK Banks Rally - last update: 03-May-2012
Elsewhere in spread betting, news of the well covered Spanish bond sale seemed to bode well for UK banks, with Barclays up 1.4% to 216.6p. Lloyds and HSBC were both 1.6% higher at 32.58p and 570.2p . . . read more Spread Betting: Successful Spanish Bond Auction Sees UK Banks Rally.
Improved Chinese Manufacturing Figures See FTSE 100 Spreads Open Higher - last update: 02-May-2012
Also in spread betting, China's manufacturing sector appeared to be easing out of its downturn after figures showed that output declined at its slowest pace in the last six months. The HSBC manufacturing . . . read more Improved Chinese Manufacturing Figures See FTSE 100 Spreads Open Higher.
Substantial Q1 Profits Prompt Rally in Lloyds Spread Betting Market - last update: 01-May-2012
Lloyds spread betting market led gains in the banking sector, rallying 2.4% to 31.76p after reporting first-quarter profits that were substantially ahead of consensus forecast following a sharp decline in . . . read more Substantial Q1 Profits Prompt Rally in Lloyds Spread Betting Market.
RBS Spreads Fall as S&P Downgrade Spanish Banks - last update: 30-Apr-2012
Elsewhere in financial spread betting, the UK 100 fell 0.48% to 5749.41 this morning, breaking a four-day winning streak, as S&P's decision to downgrade 11 of Spain's largest banks revived contagion concerns. Back home, . . . read more RBS Spreads Fall as S&P Downgrade Spanish Banks.
Online Spread Betting: FTSE Edges Higher Despite Spanish Credit Downgrade - last update: 27-Apr-2012
The FTSE 100 online spread betting market seemed to shrug off renewed Eurozone concerns, gaining 0.35% to 5768 by 10.30am (London time). The blue-chip index initially fell on the open after Spain was dealt another blow to . . . read more Online Spread Betting: FTSE Edges Higher Despite Spanish Credit Downgrade.
Shares Trading: AstraZeneca Declines on Plummeting Pre-Tax Profits - last update: 26-Apr-2012
Drug maker GlaxoSmithKline dropped 0.4% after it reported a 13% decline in first-quarter profits, while AstraZeneca declined 5.6% after it reported a 40% drop in pre-tax profits. Unilever shares climbed 3% to 2635p after sales rose . . . read more Shares Trading: AstraZeneca Declines on Plummeting Pre-Tax Profits.
ARM Holdings Spreads Rally amid Stellar Apple Results - last update: 25-Apr-2012
In equities spread trading, ARM Holdings was the top FTSE 100 gainer, up 4.3%, bouncing after a lukewarm reception to in-line results from the British chip designer on Tuesday. The price gain was on the back of forecast-beating . . . read more ARM Holdings Spreads Rally amid Stellar Apple Results.
Spread Betting Daily Index - An index of Mid-Morning Daily Spread Betting Reports covering the key Index, Forex, Shares and Commodities markets.
|
|
|
Free Financial Email: Latest Spread Betting Offers and where to find narrow spreads.
Click here to sign up.
|
|
