PARIS, Dec 29 (Reuters) - European stock index futures point to a higher open on Thursday, with stocks set to reverse some of the previous session's losses and revive their year-end rally ahead of a key bond auction in Italy. By 0721 GMT, futures for Euro STOXX 50, for Germany's DAX and for France's CAC were up 0.4-0.7 percent. Italy plans to sell up to 8.5 billion euros of bonds, including new tranches of its three-year and 10-year benchmarks, in its first long-term debt sale since ECB's huge three-year funding operation last week. Italian bond yields are expected to retreat from recent record highs at the auction, which would signal the ECB move has managed to ease market pressure, but analysts doubted whether the ECB measures and domestic progress on reform would be enough to see Italy smoothly over its refinancing hurdles from January to April, when some 91 billion euros of its bonds come due. The euro zone's blue chip Euro STOXX 50 index dropped 1.5 percent on Wednesday, halting its year-end rally and breaking below its 50-day moving average, sending a bearish technical signal. The drop in euro zone equities mirrored a sharp fall in the euro currency , which hit a near one-year low against the dollar, hurt by fresh concerns over the region's debt crisis as well as last-minute adjustments to hedging strategies, IG Markets dealer Chris Weston said. "Whilst most of the moves in the euro have been attributed to the ever ballooning balance sheet of the ECB, yesterday was the last day of the year for U.S. corporates to hedge before year-end given the time needed for settlement, so the strength in the U.S. dollar and subsequent weakness in the British pound and the euro would have largely been influenced by that." Despite the recent massive liquidity injection by the European Central Bank, banks still appear to distrust each other and prefer to deposit their money at the ECB's overnight facility than lend to each other. Latest figures show banks deposited 452 billion euros ($591 billion) at the central bank. Emergency overnight borrowing also remained high at above 6 billion euros. MARKET SNAPSHOT AT 0711 GMT LAST PCT CHG NET CHG S&P 500 1,249.64 -1.25 % -15.79 NIKKEI 8,398.89 -0.29 % -24.73 MSCI ASIA EX-JP 457.68 -0.25 % -1.14 EUR/USD 1.2939 0.02 % 0.0003 USD/JPY 77.69 -0.31 % -0.2400 10-YR US TSY YLD 1.928 -- 0.01 10-YR BUND YLD 1.896 -- -0.01 SPOT GOLD $1,548.81 -0.41 % -$6.38 US CRUDE $99.36 0 % 0.00 Wall St ends 5-day rally on renewed euro-zone concerns GLOBAL MARKETS-Asian stocks inch lower, euro extends drop Nikkei falls, market tense ahead of Italian bond sale FOREX-Euro hits 10-year low vs yen, stops add to losses Gold wallows near 3-month low; Italy bond sale eyed Copper drops as firm dollar weighs; Italy bond sale eyed Brent oil steadies above $107, dollar weighs COMPANY NEWS: PETROPLUS France's government on Wednesday offered embattled Swiss refiner Petroplus help in its talk with lenders as the firm neared a stoppage of its plants in five European countries due to a lack of crude while an angry trade union called for their nationalisation. EDF Italy market regulator Consob is unlikely to call on the French state-controlled power company to offer minority shareholders in Edison a higher price than the one it offered core Italian investors to win control of Italy's No.2 utility, market operators said on Wednesday. RWE The utility generated more power from lignite this year than in 2010 and margins from carbon emissions rights have improved, which could help soften the blow from Germany's move to exit nuclear power, Boersen-Zeitung reported, citing company sources. INTESA SANPAOLO Investment banking in Italy will see selective mergers and acquisitions, bank capital hikes and a pick-up in corporate bonds in 2012, after slower activity in the last six months, the head of investment banking at Intesa's unit Banca IMI said in an interview. ATLANTIA Italy's government is considering a toll-road fee increase of 1.8 percent from January, a government source said on Wednesday. BANCA POPOLARE DELL'EMILIA ROMAGNA The bank has signed a definitive contract for the sale of its mutual fund business run under the Optima brand to the cooperative bank-owned Arca SGR, it said on Wednesday without giving a price. CARMAKERS South Korean carmaker Hyundai Motor aims to boost its market share in Europe to 5 percent by 2015 from 3 percent now, the South Korean carmaker's deputy European chief Allan Rushforth told a German newspaper. CONTINENTAL AG The automotive supplier expects business to remain strong through the end of the first quarter, bolstered by demand in the United States and in Asia, its chief executive told a German newspaper.
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