Any initial resistance to the IMF’s gloomy update dissipated as Tuesday went on, with the Europe resuming its October decline as the Italian government sent another ripple of concern through the markets.
Addressing the Italian parliament in Rome, finance minister Giovanni Tria ended up doing little to reassure nervous investors. Though he said there will now be a ‘constructive dialogue’ with the EU Commission, the fact he called the output targets contained in the budget ‘prudent’ suggested Italy isn’t ready to shift on the spending plans that have so upset Brussels.
All this helped erase the eurozone’s early gains, with the DAX and CAC instead slipping 0.5% and 0.3% respectively. This, in turn, dragged the FTSE into the red, with the UK index falling 0.4% to hit a fresh near 6 month nadir of 7210. The pound and euro, meanwhile, were back in trouble against the dollar; cable dropped 0.3% to return to $1.305, with the single currency losing 0.4% to lurk under $1.145.
Turning to the US open and, after nudging higher on Monday, the Dow Jones is set to join its European peers in the red. The futures have the Dow sliding 90 or so points, a drop that would send the index back towards 26400.
Disclaimer: Spreadex provides an execution only service and the comments above do not constitute (or should not be construed as constituting) investment advice or recommendations, or a record of our trading prices, or an offer of, or solicitation for, a transaction in any financial instrument. Any person placing trades based on their interpretations of the above comments does so entirely at their own risk. Spreadex Ltd is a financial and sports spread betting and sports fixed odds betting firm, which specialises in the personal service and credit area. Founded in 1999, Spreadex is recognised as one of the longest established spread betting firms in the industry with a strong reputation for its high level of customer service and account management.
In relation to spread betting, Spreadex Ltd is authorised and regulated by the Financial Conduct Authority. Spread betting carries a high level of risk to your capital and can result in losses larger than your initial stake/deposit. It may not be suitable for everyone, so please ensure you fully understand the risks involved.