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European Markets Summary

London Stocks End Firmly Lower; Greece Weighs

FTSE 100 closes 1.2% lower at 5338.38. Banks are among the worst performers, with Barclays off 3.8% and Royal Bank of Scotland down 3.7%. ICAP bucks the trend, gaining 1.6% after a broker upgrade. Confidence in the markets is unlikely to improve while Greece’s fate hangs on repeat elections (June 17),  trader  says. “With a Greek exit more and more expected, we’re likely to see equities fall further before improving, meaning once the Greece situation is resolved…there’ll be a lot of underpriced stocks out there.” Meawhile, a much weaker-than-expected May reading from the Philly Fed business index adds to the downbeat tone. There are no UK data of note due Friday.

Frankfurt Stocks End Down In Thin Holiday Trade

DAX closes 1.2% lower at 6308.96, burdened by worries over the euro zone as the borrowing costs of Spain and Italy increase due to negative newsflow on the countries’ banks, plus a weak Philadelphia Fed business index print for May. Traders note that local market volumes are thin due to a public holiday in Germany and Austria. Deutsche Boerse and BMW both close lower due to dividend payouts, with ThyssenKrupp down 4.8% which one trader attributes to extreme risk aversion. Friday, the market will eye German PPI data at 0600 GMT and any news from the G-8 summit at Camp David over the course of the day.

Paris Stocks Close Firmly Lower

CAC-40 closes 1.2% lower at 3011.99 in thin trade, amid deepening economic and political upheaval in Greece and after a disappointing Philadelphia Fed business index reading, a Paris trader says. Banks are hardest hit with BNP Paribas ending down 4%, Societe Generale off 3.6% and Credit Agricole 3.5% lower. PPR finishes the session 0.5% higher after announcing talks with Italy’s Yoox on an e-commerce joint venture.

Amsterdam Stocks End Sharply Lower

Amsterdam stocks end sharply lower, on weak data from the US and amid ongoing worries over the euro zone as the borrowing costs of Spain and Italy increase due to negative news flow on the countries’ banks. The benchmark AEX falls 1.6% to 290.23 on a day which sees low trading volumes due to the public holiday in the Netherlands and much of Europe. ING loses 5.2% as banking stocks are hit hard across the continent.

Milan Stocks Close Sharply Lower

FTSE-Mib ends down 1.5% at 13,089, up from intraday lows but still feeling a heavy drag from banks suffering euro anxiety and what traders are now calling “Grexit fatigue.” Banca Monte dei Paschi, down 5.3%, and Unicredit, off 4.6%, are the session’s biggest decliners; but Atlantia, Fiat and Finmeccanica also help to pull the Milan index down. Eyes will be on the EU leaders’ conference call later Thursday

Madrid Stocks End Firmly Down; Bankia Sinks

IBEX-35 ends down 1.1% at a fresh 9-year low, as worries pile up – not least about the likely effects of Greece’s possible exit from the euro zone and that country’s repeat elections due June 17. Bankia closes more than 14% in arrears for the session after a press report, denied by the bank and the Spanish government, of massive deposit withdrawals. The INE statistics institute has confirmed Spain to be in technical recession in 1Q, while a closely-watched bond auction sees the country’s borrowing costs soar. Friday, investors will monitor developments from the central government’s meeting with regional authorities on tough austerity targets.

Athens Stocks End Down 3.4%; Govt Worries Weigh

ASE ends 3.4% lower at 536.49 as concerns over Greece’s possible exit from the euro continue to weigh, with new elections looming. “[The leftist] Syriza [party], which still leads in public opinion polls and is likely to figure prominently in any new government, is showing no signs of softening its stance on the current bailout agreement,” says UBS. National Bank shares drop 4.1%, but there are weightier losses in OPAP, down 7.4%, and Hellenic Telecommunications, off 8.1%. The tone is unlikely to improve much Friday either, as Wall Street currently trades lower after the release of a disappointing Philadelphia Fed survey.

Prague Stocks Close Firmly Lower

PX ends 0.9% lower at 867.7, as blue chips remain weighed down by concerns over Greece and its future in the euro zone. Local financial stocks suffer losses, with Erste Bank closing 3.9% lower and Komercni Banka down 0.1%. Other issues are mixed; CEZ ends flat, Telefonica Czech up 0.4%, NWR down 1.3%. “Volumes are very low,” a Prague trader says, adding that Friday will likely see the market remaining tied to events in Greece.

 

StockMarketNews Research Team

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