Equity researcher Harver Group releases its analysis of the European Markets. The markets finished down with the banking sector performing terribly. Investors worry that tapering will begin soon.
Aug. 20, 2013 - CHUO-KU, Japan -- The Stoxx Europe 600 Index lost 0.5% to finish at 304.77, negating Friday´s gain. Upbeat news from Europe, including data showing that Europe had emerged from the recession in the second quarter help to boost the markets last week. But on Monday, there were few catalysts to help drive the market and instead investors worried about how soon the United States Federal Reserve will taper its asset purchasing program. According to Analysts at Harver Group, recent data showing unemployment has declined and retail sales have improved suggests that Fed tapering could begin as early as September.
Most countries´ indices were down. In London the FTSE 100 index lost half a percentage point, France´s CAC 40 index fell a full point and in Germany the DAX 30 Index decline 0.3%. The Italian FTSE MIB Index dropped 2.5% as the yield on 10 year government bond spiked 4.27%. The drop followed reports from local newspapers that former Prime Minister Silvio Berlusconi threatened to topple the government if he is removed from the Senate.
Italian banks suffered from the news, Unaccredited Spa dropped 5.2%, Intesa Sanpaolo Spa finished 4.1% lower, and Banco Popular SC fell 4.5%. Other banks in the Euro Zone also fared poorly, Deutsche Bank AG lost 1.1% in Germany. Spanish Banco Santander SA gave up 2.9% and French Société Générale SA fell 2.6%. British banks also performed poorly on Monday, HSBC Holdings PLC lost 1.1% and Lloyds Banking Group PLC declined 1.8%.
Vodafone Group PLC also fell 1.3% in The UK, after news broke that the firm paid British Tax authorities to end a dispute over a subsidiary in Ireland.