GLOBAL MARKETS: European Stocks Seen Just Up, Eyes On Banks
LONDON (Dow Jones)--European stocks are expected to open modestly higher, supported by an almost flat close on Wall Street, even though traders remain cautious ahead of details of the capital requirements of the U.S. banks and the impact on the global economy should further injections be required.
"Financial stocks are going to remain squarely in focus after yesterday's reports of more capital being required at Citigroup and Bank of America," said Matt Buckland, a trader at CMC Markets. "The outlook for the sector as a whole remains far from encouraging."
Nonetheless, he expects London's FTSE 100 index to open 15 points higher at 4111, with Frankfurt's DAX index up 17 points at 4624. He sees Paris's CAC-40 index rising 17 points to 3068.
On Wall Street Wednesday, stocks fell heading into the close, erasing the session's gains, as traders succumbed to fears that several banks, even those too big to fail, will be required to raise capital as a result of the stress tests.
The Dow Jones Industrial Average closed 0.1% lower at 8016.95 and the Standard & Poor's 500 index finished down 0.3% at 855.16.
Both Bank of America and Citigroup fell more than 5% after The Wall Street Journal reported that the two banks were told by the government that they may need to raise more capital. Results of the banks' stress tests, being conducted by federal regulators, are expected to reveal the haves and have-nots of the banking sector.
In Europe too, the banking crisis continues to take its toll, with Societe Generale chairman Daniel Bouton saying in a statement early Wednesday that he has quit his position at the French bank.
In the statement, Bouton said he has "decided to put an end to (his) mandate as chairman of the board of directors of Societe Generale as of May 6," and that a new chairman will be elected at a board meeting on the same day.
On Monday, the bank denied a report that it could lose up to EUR10 billion at its asset management unit.
Nonetheless, investor concerns surrounding the entire global banking sector remain high.
Earlier in Asia, stock indexes were mostly higher as worries about swine flu receded. Hong Kong's Hang Seng index was 2.0% higher and China's Shanghai SEE 180 index was 2.3% up. Japan was closed for a public holiday.
Elsewhere, in the currency markets, the dollar and the yen eased back after their recent gains. The euro climbed to $1.3195 at 0620 GMT from $1.3149 in late New York business Tuesday. But the dollar rose to Y96.87 from Y96.45.
Spot gold was down $1.62 from New York, at $895.00 per troy ounce, in a choppy market, while June Nymex crude oil futures were barely changed from New York at $49.90 per barrel.
-By Kimberly Vlach, Dow Jones Newswires; +44-20-7842-9352; kimberly.vlach@dowjones.com
Click here to go to Dow Jones NewsPlus, a web front page of today's most important business and market news, analysis and commentary: http://www.djnewsplus.com/access/al?rnd=vV6ro2ZV050qOZbQiXWzFA%3D%3D. You can use this link on the day this article is published and the following day.
(END) Dow Jones Newswires
April 29, 2009 02:24 ET (06:24 GMT)
Copyright 2009 Dow Jones & Company, Inc.
By Kimberly Vlach
Of DOW JONES NEWSWIRES
LONDON (Dow Jones)--European stocks are expected to open modestly higher, supported by an almost flat close on Wall Street, even though traders remain cautious ahead of details of the capital requirements of the U.S. banks and the impact on the global economy should further injections be required.
"Financial stocks are going to remain squarely in focus after yesterday's reports of more capital being required at Citigroup and Bank of America," said Matt Buckland, a trader at CMC Markets. "The outlook for the sector as a whole remains far from encouraging."
Nonetheless, he expects London's FTSE 100 index to open 15 points higher at 4111, with Frankfurt's DAX index up 17 points at 4624. He sees Paris's CAC-40 index rising 17 points to 3068.
On Wall Street Wednesday, stocks fell heading into the close, erasing the session's gains, as traders succumbed to fears that several banks, even those too big to fail, will be required to raise capital as a result of the stress tests.
The Dow Jones Industrial Average closed 0.1% lower at 8016.95 and the Standard & Poor's 500 index finished down 0.3% at 855.16.
Both Bank of America and Citigroup fell more than 5% after The Wall Street Journal reported that the two banks were told by the government that they may need to raise more capital. Results of the banks' stress tests, being conducted by federal regulators, are expected to reveal the haves and have-nots of the banking sector.
In Europe too, the banking crisis continues to take its toll, with Societe Generale chairman Daniel Bouton saying in a statement early Wednesday that he has quit his position at the French bank.
In the statement, Bouton said he has "decided to put an end to (his) mandate as chairman of the board of directors of Societe Generale as of May 6," and that a new chairman will be elected at a board meeting on the same day.
On Monday, the bank denied a report that it could lose up to EUR10 billion at its asset management unit.
Nonetheless, investor concerns surrounding the entire global banking sector remain high.
Earlier in Asia, stock indexes were mostly higher as worries about swine flu receded. Hong Kong's Hang Seng index was 2.0% higher and China's Shanghai SEE 180 index was 2.3% up. Japan was closed for a public holiday.
Elsewhere, in the currency markets, the dollar and the yen eased back after their recent gains. The euro climbed to $1.3195 at 0620 GMT from $1.3149 in late New York business Tuesday. But the dollar rose to Y96.87 from Y96.45.
Spot gold was down $1.62 from New York, at $895.00 per troy ounce, in a choppy market, while June Nymex crude oil futures were barely changed from New York at $49.90 per barrel.
-By Kimberly Vlach, Dow Jones Newswires; +44-20-7842-9352; kimberly.vlach@dowjones.com
Click here to go to Dow Jones NewsPlus, a web front page of today's most important business and market news, analysis and commentary: http://www.djnewsplus.com/access/al?rnd=vV6ro2ZV050qOZbQiXWzFA%3D%3D. You can use this link on the day this article is published and the following day.
(END) Dow Jones Newswires
April 29, 2009 02:24 ET (06:24 GMT)
Copyright 2009 Dow Jones & Company, Inc.
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