Spain relieved from a political gridlock | presented by Calamatta Cuschieri

Spain's minority government

European Markets were in the green on Monday, with better than expected Eurozone data serving as a strong support. Spanish shares were amongst the best performing, helping the IBEX index 1.45% up. This happened as Mariano Rajoy is being re-elected as prime minister, following the acceptance of forming a minority government.  

Good news for Portugal

Portugal also enjoyed some positive news after rating agencies decided to maintain the country’s investment grade rating. Tracking this Portugal maintains access to the ECB’s bond-buying program, which the adverse result would have led to higher funding costs for the country.  

Market Highlights

The German DAX closed 0.56% higher, tracking the good performance in the banking sector, especially Commerzbank jumping over 3%. However, there was a decrease in the FTSE 100. Hikma pharmaceuticals took the plunge with its shares falling around 2.4%. The mining sector also suffered losses with Anglo American and Randgold both traded in the red over 2%.

Precious metals traded mixed as the U.S Dollar climbed to its highest level for the past months. The dollar remained strong despite market worries and speculations on the timing of the next U.S interest rate hike. However, the market for Gold remained stable, with a current support by the rising demand in Asia. 

Oil prices continued to fall on news that Iraq was unwilling to join the deal being established by OPEC. In fact, Brent futures for December was down around 0.65% even touching a low of $51.25 per barrel. Iraq, which is OPEC’s second largest producer, stated that it should be exempt from any output cuts as it is involved in a war with the Islamic State.

What's happening on Wall Street

On Wall Street, U.S Markets tracked a string of positive corporate news, including an $85 billion merger between AT&T and Time Warner announced over the weekend.  Technology company 3M saw its shares rise, closely followed by Boeing, up around 1.73%. In fact, the Dow Jones was around 0.4% in the green.  Markets remained positive amid a better-than-expected earnings season that is due to continue well into this week. 

Other Corporate News

The American online broker Toronto Dominion (TD) Ameritrade and its largest shareholder, TD Bank said are in the middle of a $4 billion deal taking over Scottrade Financial Services. TD Bank will be acquiring Scottrade Bank for $1.3 billion in cash and $400 million in equities. TD Ameritrade will then have its brokerage operations for $2.7 billion. The combined companies will have around 600,000 executed trades per day and $944 billion in clients’ assets. The consolidation comes in view of lower trading volumes and slow revenue growth in current market scenarios.  On the news, Ameritrade shares were around 3% down.

In Switzerland, Agribusiness Syngenta AG shares underperformed as the company missed a deadline set by the European regulators in order to be able to merge with China National Chemical Corp. The company did not submit proposed solutions to resolve potential antitrust concerns related to the merger. Syngenta AG shares dropped around 5.8%.

This article was issued by Rodrick Duca, Trader at Calamatta Cuschieri. For more information visit, www.cc.com.mt. The information, view and opinions provided in this article is being provided solely for educational and informational purposes and should not be construed as investment advice, advice concerning particular investments or investment decisions, or tax or legal advice. Calamatta Cuschieri Investments Services Ltd has not verified and consequently neither warrants the accuracy nor the veracity of any information, views or opinions appearing on this website.