STOCK MARKET WATCH -- Tuesday, 10 July 2012

[Ghost Dog]

47. Spanish deal lifts world shares, euro steady

(Reuters) - World shares inched up on Tuesday after euro zone finance ministers made limited progress on measures to help embattled Spain, but evidence of a sharp slowdown in China sent oil and industrial commodities lower.

U.S. stocks were poised to open higher as risk assets were supported by hopes Germany's top court would ultimately approve the European Union's new permanent bailout fund, paving the way for its funds to be used more flexibly to ease the crisis...

..."Very little is expected to come out of the various meetings or constitutional court," said Ian Stannard, head of European FX strategy at Morgan Stanley...

... Sentiment was stronger in equity markets after an all-night meeting of euro area finance chiefs agreed a deal which will release 30 billion euros of bailout funds for Spain's troubled lenders by the end of July.

The euro zone ministers also decided to grant Spain an extra year, until 2014, to reach its deficit reduction target but made no apparent progress on how the bloc's new rescue fund, the ESM, will be used to help lower Madrid's elevated borrowing costs.

/... http://in.reuters.com/article/2012/07/10/markets-global-idINDEE86909U20120710

Thanks for the timely reporting, again, Reuters India! (although your site is often verrry slow to load).


European governments will jump-start as much as 100 billion euros ($123 billion) in emergency loans to shore up Spain’s banks and may move the costs off the Spanish government’s balance sheet to shield the euro region’s fourth- largest economy from the debt crisis.

Spanish equities and bonds gained after finance chiefs agreed to make available 30 billion euros by the end of this month. The goal is to eventually use the euro-area bailout fund to recapitalize banks directly instead of saddling the government with the debts.

The initial cash will “be mobilized as a contingency in case of urgent needs in the Spanish banking sector,” Luxembourg Prime Minister Jean-Claude Juncker said early today in Brussels after chairing a nine-hour meeting of euro-region finance ministers. The program “will succeed in addressing the remaining weakness in the Spanish banking sector.”

European governments frontloaded the Spanish aid, held out the prospects of concessions to Ireland and promised to avert a cash crunch in Greece after last month’s summit-level pledge to calm markets failed to prevent a resurgence in the 2 1/2-year- old debt crisis.

/... http://www.businessweek.com/news/2012-07-09/eu-to-speed-spanish-bank-aid-aims-for-direct-recapitalization