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Stockholm and most European major markets crush barrier on Friday as market got excited by crisis solutions

Friday, 29 June 2012
Surprising news from the EU summit was good for risk appetite in the Stockholm stock market n Friday and it ended in a crushing highest level ever seen this year.

The agreements included by the European monetary Union - the European Stability Mechanism (ESM) loan to Spanish banks will not have senior creditor status which effectively takes pressure off the country’s credit spread; the ESM will also be allowed to directly recapitalise banks; the rescue funds themselves will be used more flexibly to support compliant countries; and finally, the European Central Bank (ECB) will be acting as an agent for the rescue funds in market operations.

Also the U.S. data that was received during the day were as expected and did not affect mood in the stock market.

The news fuelled a surge in stock markets across Europe today, with benchmarks in France, Italy, Spain and Germany registering gains of 4-6 percent by the close. London's Footsie and the three major indices in the US were up around 2 percent each.

US stocks were making ground despite consumer sentiment data for June hitting its lowest levels since December and consumer spending falling in May for the first time since November.

While more news will likely leak out about the meeting throughout the rest of the day and over the weekend, investors are already looking ahead to policy decisions in the UK and Europe due next Thursday. The Bank of England is widely expected to ramp up its asset purchase programme, while the ECB is predicted to cut rates to a new low.

Stockholm Stock Exchange OMXS30 index closed 4.0 percent up on 1019 levels. The turnover on the Stockholm Stock Exchange was Skr13.5 billion, and including trade on Chi-X, Burgundy, Turquoise and Bats was Skr15.4 billion.

On the company front Atlas Copco A, Volvo and Sandvik were noted between 6.4 and 7.4 percent up.

The major banks also closed the heavily as they were recorded between 3.4 and 5.6 per cent higher, with Nordea in the top.
Nokia was today's big loser in the large cap index, - 3.8 percent.
"Nokia is a chapter of its own, it has enormous problems. Market has not recovered from the shock of last week, and then the Lumia cannot be applied on the Windows 8. The market has had enough. Expectations for the third quarter are bad "notes the broker who spoke to Swedish media sources.

Defence group Saab received an order from the Armed Forces worth Skr3.6 billion plus an option for a further Skr2 billion, the current development and maintenance of Gripen until 2016 pushed its Shares to close up 6.2 percent.

Index Heavy H & M did not see the same rally tendencies as the rest of the stock market, and closed up 2.2 percent.
Commodity-related had a strong trading in the wake of rising prices on the London Metal Exchange and a higher oil price. SSAB and Boliden was up 7.1 and 5.6 percent, while Lundin Petroleum closed slightly lower, 3.1 percent up.

Africa Oil had a turbulent day of trading, when it was struck by poor drilling news from Kenya in the morning: an unexpected geological formation is found. Shares recovered slightly in the afternoon, but closed 4.6 percent down.

KappAhl's report showed that sales fell more than the low expectations, but stock levels were reported to be satisfactory. The share peaked up 6 percent, but then shut down 1 percent.

The krona appreciated against the dollar and the euro.

Next week, interest statements from the Swedish central bank or the Riksbank will be expected as well as information about the purchasing managers' index for services and statistics on the number of newly registered passenger cars in June.
By Team

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