Finance Matters

Posts Tagged ‘European markets’

ORIGINAL POST: Early in the morning in Europe, leaders in Brussels announced a debt restructuring deal, aimed at bringing the country’s debt-to-GDP ratio down to 120% or so by the year 2020.

Well, it must have been priced in, because markets don’t really care.

US futures — though they’re pointing up — are where they were yesterday, and European markets are flat.

France, for example, is up 0.07%. Italy is up just a little more. Germany is down 0.03%. The Athens market is actually getting the worst of it, falling 1.7%.

So overall, nothing horrible, but nothing too exciting post-deal.

Update 5:00 AM: And now markets have turned red, with Italy off 0.5%, and other markets off a bit less.

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See Also:

• Look What Markets Are Moving Identically Again Today
• Sell The News: Markets Fall In Asia After Europe Reportedly Agrees On A Greek Bailout Deal
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Total eurozone GDP showed less than expected contraction at -0.3% q/q versus expectations for -0.4%. This is the first contraction since 2009, but remember, it takes quarters of negative growth in a row to constitute a recession.

The Stoxx Europe 600 index is up 0.5%.

European markets were also boosted by talk of additional support from China and strong earnings from BNP Paribas, Heineken and Peugot.

Dutch preliminary fourth quarter GDP missed bigtime with a -0.7% q/q decline versus expectations for +0.3% q/q growth.

Italy showed -0.7% q/q contraction, worse than already ugly expectations for -0.6% contraction.

France on the other hand smashed expectations with  +0.2% q/q growth versus expectations of a -0.2% q/q contraction.

German GDP showed a -0.2% q/q contraction, beating expectations of a -0.3% q/q contraction.

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See Also:

• Neel Kashkari On Europe: We Had Time To Prepare For Lehman Brothers, But That Still Ended In A Massive Shock
• European Markets Get Crushed On A Chaotic Day For Greece
• UBS Answers: Who Are The Fittest Countries In Europe?

Greece was expected to report by noon (5 EST) whether its political parties have agreed to accept austerity proposals, according to a deadline set by Prime Minister Lucas Papademos.

Less than an hour before the deadline, however, a Greek official told Reuters that there is no deadline today.

Via FT’s Chris Adams:

• All notion of a deadline vanishes: Greek official says no deadline on Monday for political leaders to respond to bail-out terms (!) – RTRS
• Greek govt official says only deadline is for Greek govt, EU/IMF inspectors, political leaders to reach a deal before Eurogroup meeting -RTR
• Which all means, as we knew, that EZ ministers will meet if/when a deal is reached, which will be the moment when a deadline is reached. QED

See here who gets clobbered if Greece defaults >

Meanwhile European markets are mostly lower,  lead by the Cac 40 down over 1%.

Dow futures are down 64 points and S&P 500 futures have dropped 8 points.

Asian markets had a better day  catching up to a strong rally in the US on Friday, with the Nikkei up 1.1 percent to a three-month high.

It is a risk off day, tweets WSJ’s Richard Barley, with bunds taking back all of Friday’s sell-off and the yield on the US 10-year declining 7 basis points to 1.86 percent.

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See Also:

• RUMOR DENIED? Now The Greek Debt Swap Deal Will Be Signed ‘This Week’
• CHART: The 1-Month And 12-Month Return Of Every Major Stock Market In The World
• In Case You Hadn’t Noticed, Everything Is Going Wrong In Greece Right Now

Today was a huge day for the economy. U.S. companies added 243k jobs in January and the unemployment rate fell to 8.3%.

This fueled a major surge in the stock markets, which hit some major milestones.  Both the Dow Jones Industrial Average and the Nasdaq hit pre-financial crisis levels.  The Dow closed at 12,862, a 4-year high, and the Nasdaq jumped to 2,905, an 11-year high.

The S&P 500, which is arguably the best snapshot of the U.S. stock markets, hit 1,344, a 6-month high.

Here’s a look at some historical charts courtesy of Yahoo Finance.

SEE ALSO: Wall Street’s Sharpest Minds Predict Where Stocks Are Headed In 2012 >

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• STOCKS GO NOWHERE ON MORE DISAPPOINTING DATA: Here’s What You Need To Know
• Asian Markets Are Mixed After Chinese PMI Beats Expectations
• European Markets Are In Total Melt-Up Mode To Start The New Month

Paul Krugman is giving a talk in Paris, and he’s put up several charts that he says are key to understanding the Eurozone crisis.

This one may be the best, as it debunks the idea that the PIIGS — called the GIPSIs in this chart — were running up debt like crazy.

They weren’t. They had declining ratios, which only exploded once the financial crisis hit.

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See Also:

• Why Portugal Might Be The Real Trigger That Causes The Eurozone To Spiral Out Of Control
• Two Big Lessons From The Dazzling Market Rally In Europe…
• European Markets EXPLODE Higher And Investors Wonder If The Rally Can Last