Bank stocks suffer further falls
Banking stocks were once again in focus as US debt fears undermined risk attitude. With less than a week before a potential US default, political deadlock is continuing to weigh on equity markets, with all major European indices ending the day more than 1% lower. Adding to the woes was further news from the US, which showed an unexpected fall in Durable Goods Orders in June (items designed to last more than 3 years). The data is a leading indicator as to the health of manufacturing and capital spending by businesses, and adds to existing evidence of a prolonged soft patch in the US economy.
Autonomy Corporation’s gain of 3.9% saw it leading an otherwise disappointing FTSE, the software group buoyed by upbeat second quarter results and a particularly positive outlook for its cloud computing business. Scottish & Southern lagged the market with a 5.3% fall on the day, although much of this was attributed to the stock becoming ex-dividend.
Financials were not far ahead with the usual suspects of RBS, Barclays and Lloyds all weakening more than 3%. This came amid a downgrade of European banks from Goldman Sachs, which stated that questions marks remained regarding the second bailout for Greece, in particular the funding of the expanded European Financial Stability Fund which was designed to prevent contagion.
As the FTSE 100 fell 73 points to 5857, the familiar safe havens plays (precious metals, Swiss franc and the USD) all enjoyed further inflows.
This was posted in Bdaily's Members' News section by John Dance .
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