Optimism over Greek Deal Help Markets Brush Off France’s Downgrade
Markets were pushed up after the news came out that Greece will acquire its next part of bailout cash to avert bankruptcy despite a drop in France’s credit rating.
Finance ministers from European countries are gathering in Brussels and they are likely to agree to release more bailout cash to Greece.
For past few weeks, markets have been eagerly waiting for a decision on whether the next batch of rescue cash will be given to Greece as the nation’s creditors resolve whether it has enforced the required reforms. Athens relies on the capital to pay its day-to-day bills, and it will have shortage of money if it doesn’t obtain the $40 billion bailout cash soon.
Joshua Mahony, an analyst at Alpari said that the suggestions from policy makers connected with euro zone meeting have hinted that an announcement may come out and might be provided after the close of the stock markets.
The FTSE 100 index of British shares reversed past losses to end at 0.2% higher at 5,748.10. DAX-Germany went up by 0.7% to 7,172.99 and the CAC-40 index in Paris closed 0.7% higher at 3,462.06. The euro stock was also floating, trading an extra 0.2 percent at $1.2805.
Previously, the euro markets were uncertain about the decision of Moody to strip France to its valued AAA rating on November 18, mentioning its restricted prospects for exposure and growth to the calamity that has pushed many countries to bailouts.
Ben Bernanke, Federal Reserve Chairman, in his speech warned lawmakers in Obama and Congress administration to attain a budget deal to avoid spending cuts and tax increases that could make a recession in 2013. The investors are now focusing on his speech.
Without an agreement, the fiscal drop can be seen in January, but there it is believed that the deal might be agreed from the cheering signs in the past few days. That helped the stocks to rise over the past few trading days.
Trading points will inevitably fall in the U.S ahead of Thursday. The analysts hope that might prompt few traders to cut their exposure to few trades.
The trading was less active in the U.S. with a 0.1 percent down in Dow Jones industrial, closing at 12,781. The S&P 500 index was unchanged at 1,386.
Analysts believed that the shares of Mainland also closed down by the falling trading volumes. The Shanghai Composite Index declined by 0.4% to 2,008.92 and the Shenzhen Composite Index fell by 0.2 % to 799.35.