European Market Shows Anxiety
The European stock market opened lower on Friday, breaking a three-day streak of gains.
Friday, October 24, 2014 - 00:00
Investors were wary before the results of broad European Union bank stress tests, while the first case of Ebola reached New York City.
Europe’s benchmark index, the Stoxx Europe 600, dipped 0.3% in mid-morning trading after posting gains in three consecutive sessions. The index had gained 3% on the week prior to this morning.
European banks undergo stress tests
In an effort to publicize banks’ ability to withstand a recession, credit analysts and officials will release scorecards for about 150 lenders across London, Frankfurt and other European centers of commerce, The Wall Street Journal reported. “Following our assessment of several banking systems in a series of reports published over the past year, we have identified vulnerabilities in some banks in Italy, Greece, Portugal and Germany, while most banks in Spain and France appear well positioned,” economists at Barclays told the news source.
According to Gildas Surry of BNP Paribas SA, dozens of banks will fail the test, but some of those amassed enough capital to satisfy regulations.
Ebola to impact markets A New York City doctor who treated Ebola patients in West Africa and returned to the US tested positive for the virus on Friday, CNN reported. While the news has people on edge, it is unlikely anyone else contracted the virus from him. An infected individual is not contagious until he or she becomes symptomatic and the doctor only displayed symptoms on Thursday. He was not in public at that point.
However, the news is likely to affect the global markets. Shaky European stocks are unlikely to take the news in stride. In the US, some investors may actually gain from the development. Shares in Ebola vaccines and pharmacies developing antidotes have the potential for gains. US markets are higher this morning. The Dow, Nasdaq and S&P 500 are all hovering in the vicinity of 0.2% to 0.3% gains.
Guard against global risk
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