UK 100 Surges as Cyprus Secures Last Minute Deal
On the back of the successful last minute negotiations between the Cypriot government and the troika, European markets have rallied in the opening hours of the trading week.
At 9.30am (London time) the UK 100 spread betting market was up 42 points at 6435.
The Cypriot government have resolved to take some tough decisions and will effectively let the country’s second largest bank Laiki ‘fail’.
This will ensure all those who had accounts under €100,000 will have their money protected, but there are some with funds above that level who will see 40% wiped off their savings.
Although in the short-term this does save the country’s banks, it is likely to come at the cost of its offshore banking status and could set a dangerous precedent.
This may not be the perfect result for all parties but equities have roared higher as an instant relief rally has powered the Monday morning markets.
Once again, the banking sector will be under scrutiny following this weekend’s negotiations and traders will be closely watching for any repercussions.
Aberdeen Asset Management have benefited from the general upward curve in 2013, with the addition of Â£3.5 billion in funds that have been placed with them from investors looking to capitalise on the sizeable move in global indices.
Cazenove Capital looks to be another of the city’s historic private banking firms to be engulfed, as fund manager Schroders looks to complete the acquisition for Â£424 million.
Looking ahead to the US open, at 9.30am (London time) the Dow is being called to open up 61 at 14,573.
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Financial Market Comments from Alastair McCaig, Market Analyst, IG Index.
The above comments do not constitute investment advice and Clean Financial accepts no responsibility for any use that may be made of them.
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