Markets rally strongly on positive European news $CLc1
- Published: 02 July 2012
- Markets rallied strongly on Friday night after a surprisingly positive outcome from the European summit. Investors were encouraged by developments that will allow the European Stability Mechanism (ESM) to invest directly in stricken banks so as to avoid a potentially catastrophic bank failure
- Tentative agreements were made for a centralized super visionary authority to regulate European banks. This body would be governed by the ECB, however its powers and reach remain unclear at this early stage
- UK bank Barclays remains under intense pressure after it was fined $453 Million by UK and US regulators after it manipulated the LIBOR interest rate by submitting inaccurate forecasts. Chairman Marcus Agius is expected to step down tonight and pressure is mounting on CEO Bob Diamond to resign
- Leading the gains on the Dow overnight was BAC, CSCO, UTX, HPQ and BA each rallying 5.68%, 4.19%, 4.04%, 3.87% and 3.80% respectively
- DOW +2.20%, S&P500 +2.49% and NASDAQ +3.00%
- EUR rallied strongly after the positive news and the AUD is above 1.0200
- Gold continues to trade like a risk asset and rose on positive EU news. Crude rose sharply, jumping 9.4% as market appetite for risk increases
