A check of European closing prices finds the euphoric early reaction to the "No" vote from Scotland mostly faded by day's end. The Stoxx 50 (NYSEARCA:FEZ) closed just 0.2% higher, with the U.K.'s FTSE 100 (NYSEARCA:EWU) gaining 0.3%.
Looking at U.K. bank ADRs: RBS (RBS +1.2%), Barclays (BCS -0.9%), Lloyds (LYG +0.5%), HSBC (HSBC -0.2%).
Dealing with its own separatist movement, Spain (NYSEARCA:EWP) managed just a 0.1% gain.
The ECB cut its growth forecast for the EU for 2014 and 2015, says Mario Draghi at his post-meeting press conference, but raised its outlook for 2016. Inflation is seen at lower-than-expected levels in the coming months before increasing gradually in 2016.
The central bank, says Draghi, will start to purchase a broad portfolio of euro-denominated covered bonds and also begin to buy ABS, with further details coming in October. It sounds like the Germans are on board: "Should it become necessary, the Governing Council is unanimous in using additional measures."
The Stoxx 50 is now higher by 1.5% and the euro lower by 1% to $1.3015.
While the Ukraine president's office says Porshenko and Putin agreed to a cease-fire in eastern Ukraine, a Kremlin spokesman says the two only discussed steps to facilitate a cease-fire. "Russia can't negotiate a cease-fire because it isn't a party to the conflict" ... and so it goes.
Major U.S. stock index futures are all ahead about 0.45%, and Europe's Stoxx 50 (NYSEARCA:FEZ) is up 1.3%. The Hang Seng's 2.3% gain led Asia higher overnight.
The 10-year Treasury yield is up three basis points to 2.45% and gold is up $3 per ounce to $1,268.
Major stock index futures are all off about 0.4% amid what appears to be a new front opened by Russia in its fight with Ukraine. President Petro Porshenko has canceled a trip to Turkey, telling the nation "the introduction of Russian forces into Ukraine has taken place." His government says Russian troops have seized the town of Novoazovsk and several villages near the Russian border.
Russia's Micex slides 2.1%.
Europe's Stoxx 50 (NYSEARCA:FEZ) is lower by 1.2%, led by Germany's (NYSEARCA:EWG) 1.5% decline, and Asia posted moderate losses overnight.
The 10-year Treasury yield is carving out new lows, off three basis points to 2.33%. German 10-year Bund yields are lower by two basis points to 0.89%.
S&P 500 (NYSEARCA:SPY) and DJIA (NYSEARCA:DIA) futures are up 0.2% and Nasdaq 1000 (NASDAQ:QQQ) up 0.15% ahead of a reasonably busy day of earnings reports and economic news, with jobless claims at 8:30 ET, Flash PMI at 9:45, and Philly Fed and Existing Home Sales at 10.
A 1.4% gain in Italy (NYSEARCA:EWI) is leading Europe's Stoxx 50 (NYSEARCA:FEZ) higher by 0.8%, and the Nikkei's 0.9% gain led Asia overnight.
The 10-year Treasury yield is up one basis point at 2.44% and gold is lower by $12 per ounce to $1,283.
Reversing a big YTD trend, U.S. investors pulled nearly $4B out of Europe-focused ETFs over the past week. Among the reasons, suggests Markit's Simon Colvin: Europe is seen as more exposed to Russian sanctions, anemic European growth, and a strengthening U.S. dollar. "The only certainty is that a growing portion of American investors think that their assets are better invested outside of Europe, something which wasn't the case six weeks ago."
Interestingly, it's the "core" Eurozone countries like Germany (NYSEARCA:EWG) and France (NYSEARCA:EWQ) with which U.S. investors are least interested, while Italy (NYSEARCA:EWI) and Spain (NYSEARCA:EWP) have seen net inflows over the past three months.
Up nearly 1% not long ago, Europe's Stoxx 50 (NYSEARCA:FEZ) is lower by 0.6%, led by Germany's (NYSEARCA:EWG) 1% decline after Ukraine says it wiped out a Russian military convoy. Germany's 10-year Bund yield carves out another all-time low at 0.965%.
An early U.S. gain is erased as well, with the S&P 500 (NYSEARCA:SPY) down 0.25%. The 10-year Treasury yield falls to a level not seen since May 2013, off six basis points to 2.34%. TLT +1.2%, TBT -2.3%
Down more than 1% earlier, gold (NYSEARCA:GLD) is now lower by 0.6% at $1,307 per ounce.
Euro-Zone GDP failed to grow in the second quarter following 12 months of weak growth, causing European equity markets to fall and increasing pressure on the ECB to do more to boost growth and inflation.
Data released this morning by the European Union's statistics office translates into 0.2% growth in annualized terms, down from the first quarter's 0.8% pace.
The euro zone's three largest economies, which account for two-thirds of the region's €9.6T ($12.8T) GDP, all did not post any growth. German GDP shrank 0.2% from the first quarter and Italy's output fell at a similar pace. The French economy, the bloc's second largest behind Germany, stagnated for a second straight quarter.
The region's next largest economies, Spain and the Netherlands, posted some growth but not enough to offset their larger peers.
Down more than 0.5% ahead of the print, S&P 500 (NYSEARCA:SPY) futures are now off 0.25% as the 10-year Treasury yield retreats to 2.53% from 2.59%. Europe cuts its losses as well, with the Stoxx 50 (NYSEARCA:FEZ) now down just 1% vs. 1.5% ahead of the number.
Major index futures are ahead 0.2-0.3% as Europe's Stoxx 50 (FEZ) gains 0.5%. After reopening for trade, Banco Espirito Santo is down another 5.1%, but Portugal overall is up 2%. Trying to reassure markets, the bank says it has €1.18B in loans, securities, and other item linked to its troubled parent, Grupo Espirito Santo.
Asia closed mixed overnight.
The U.S. 10-year yield is down one basis point at 2.53% and gold is down $1 an ounce at $1,338.
Down more than 2% at the session low, the Stoxx 50 (FEZ) closed with a loss of 1.6%. Spain and Italy were each off about 2%, while Germany (EWG) lost 1.5%, France (EWQ) 1.3%, and the U.K. 0.7%. Portugal's PSI 20 Index dove 4.2%, led by Banco Espirito Santo's 17.2% loss (it was halted from trade before the market close).
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