Europe mid-morning: Greek exit poses a major risk for Spain, Moodys' says

-Moody's confirmed Spain's government bond rating, with a negative outlook -Conflicting reports regarding frictions ahead of EU summit -Spanish risk premium drops below 400bp -Italy 2 year bond yields fall below 2 per cent

-Moody's confirmed Spain's government bond rating, with a negative outlook

-Conflicting reports regarding frictions ahead of EU summit

-Spanish risk premium drops below 400bp

-Italy 2 year bond yields fall below 2 per cent

FTSE-100: 0.19%

Dax-30: 0.14%

Cac-40: 0.31%

FTSE-Mibtel 30: 0.61%

Ibex 35: 1.31%

Stoxx 600: 0.05%

European equities are now registering slight gains ahead of today's avalanche of US company results (and a negative reaction to those out from IBM and Intel overnight) following ratings agency Moody's decision last night to maintain Spain's investment grade rating on the country's debt.

Worth noting, amongst the reasons cited by Moody's for its decision are that: "the rating agency believes that Spain will likely apply for a precautionary credit line from the European Stability Mechanism (ESM)."

Also worth pointing out, Moody's does not believe that the above would lead -in and of itself- to a downgrade, although it does warn that certain events could still see the rating drop to "junk," with a potential exit of Greece from the single currency area posing a major event-risk.

Danone is down by 4% after reporting a slowdown in revenues at its main dairy division.

Dutch semiconductor equipment maker ASML is dropping 2% after forecasting fourth-quarter sales that trailed behind projections. As well, the company will acquire Cymer for $2.6bn.

PSA Peugeot is advancing 2% as Le Figaro said the French government may bail out the automaker's credit unit.

From a sector stand-point the best performers are now to be found in the following industrial groups within the DJ Stoxx 600: Basic resources (1.1%), Construction&Materials (0.82%) and Automobiles (0.62%).

Eurozone construction output grew by 0.7% month-on-month in August, following a fall of 0.3% in the month before.

Sharp rise in the single currency

The euro/dollar is now sharply higher, at 1.3098.

Front month Brent crude futures are now down by 0.202 dollars to the 113.78 dollar mark.

Ab

Recommended

The ten highest dividend yields in the FTSE 100
Income investing

The ten highest dividend yields in the FTSE 100

Rupert Hargreaves takes a look at the companies with the highest dividend yields in the UK’s blue-chip index
6 Feb 2023
The outlook for Shell shares is mixed, despite bumper profits
Energy stocks

The outlook for Shell shares is mixed, despite bumper profits

With profits surging, it looks as if Shell is on a roll, but the company’s growth from here is hard to see as Rupert Hargreaves explains.
6 Feb 2023
The top funds to invest in
Funds

The top funds to invest in

As market volatility and recessionary fears continue, here are the most popular funds, stocks and trusts investors are putting their money into accord…
2 Feb 2023
The top ten dividend stocks in the FTSE 250
Share tips

The top ten dividend stocks in the FTSE 250

The average FTSE 250 dividend yield is around 4%, but many stocks yield much more. Rupert Hargreaves picks the best FTSE 250 stocks for income investo…
17 Jan 2023

Most Popular

NS&I brings back one-year fixed bonds with highest rates since 2010
Personal finance

NS&I brings back one-year fixed bonds with highest rates since 2010

NS&I’s one-year fixed bonds are back on sale after being pulled off the market in 2019 - but is the rate any good?
1 Feb 2023
How to invest like an ISA millionaire
Investments

How to invest like an ISA millionaire

We reveal the top funds and trusts ISA millionaires pumped their money into
6 Feb 2023
The best one-year fixed savings accounts - February 2023
Savings

The best one-year fixed savings accounts - February 2023

Earn almost 5% on one-year fixed savings accounts.
6 Feb 2023