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European Banks Drop After Stress Tests; Oil Falls, Pound Weakens

Posted by Chris Advincula on Aug 1, 2016 6:57:38 AM

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(Aug 1 Bloomberg) European bank stocks fell, tempering gains in global equity indexes, amid investor skepticism over the usefulness of stress-test results and weaker oil prices. Shares and currencies in emerging markets rallied to the highest in about a year, while miners and industrial metals jumped.

Lenders in so-called peripheral nations weighed heaviest on an index of lenders, which sank as much as 2 percent after opening stronger. The MSCI Emerging Markets Index jumped to the highest since last August and the equivalent currency index to the highest since July 2015, with Malaysian ringgit and South Korea's won gaining the most. Zinc headed for the highest close in a year. The pound weakened against all of its 16 major counterparts.

Declines in European banks put a dent in global equities, which rallied in July to their best month since march on prospects central banks will add to stimulus or refrain from reducing it. Traders peeled back bets on a U.S. rate hike this year after data Friday showed annualized gross domestic product rose 1.2 percent last quarter, less than half the 2.5 percent projected by economists. The Bank of Japan added to its easing last week  and economists forecast policy makers in Australia and England will cut their benchmark interest rates from record lows this week.

Click on the link below to see the full story from Bloomberg: (by Emma O'Brien and Eddie Van Der Walt)

European Banks Drop After Stress Tests; Oil Falls, Pound Weakens

 

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Topics: GBPUSD, Stocks, Equities, crude oil, Forex, WTI, Fundamentals, Brent

 

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