FTSE Market Rises as EU Hurries to Backtrack on Dijsselbloem Comments
In mid-morning trading, the FTSE is edging cautiously higher, but nervousness around the Cyprus deal persists.
Calm has finally descended after the turmoil of the Cyprus bailout, but the damage to investor confidence has been done.
Eurozone bureaucrats scrambled to backtrack on comments made by Jeroen Dijsselbloem, and it now appears that the Cyprus bailout is a one-off, not to be repeated event.
This is unlikely to reassure nervy depositors, who will be keenly watching for any suggestion that they might have to pay up in any future bailout.
The greatest worry is that the Eurozone has stuck itself with yet another long-running sore, with additional agreements likely further down the road as the Cypriot economy continues to struggle.
Anyone who thinks that the situation is now completely resolved is likely to be sorely disappointed.
Fortunately, we have plenty of US economic data today to keep us occupied.
In recent months, the presence of strong figures from the world’s largest economy has allowed investors to shrug off any Eurozone weakness.
After a week of concentrating on the squabbles of Europe, it will be a relief to focus on the continuing improvement in the US.
Ahead of the open, we expect the Dow Jones to start around 40 points higher at 14,487.
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Financial Market Comments from Chris Beauchamp, Market Analyst, IG Index.
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