30. November 2012, 12:02

Morning Call vom 30.11.2012 von Michael Hewson, FX-Analyst von CMC Markets

EU unemployment set to hit another record
By Michael Hewson (Senior Market Analyst at CMC Markets UK)

For all this week?s on-off optimism surrounding the on-going US fiscal cliff negotiations, the latest Greek debt deal, and the steps by Spain to draw a line under its banking crisis with this week?s restructuring plan, the fact remains that a number of hurdles remain in Europe before investors can return to the markets with a degree of confidence.

Even though equity markets hit three month lows in mid-November we remain on course for the sixth monthly rise in a row, though we still remain below the September highs.

Today?s economic data is expected to starkly illustrate the problems facing Europe when we expect to see the EU unemployment rate to keep rising to a new record of 11.7% for October, up from 11.6% in September.
Italian unemployment is also expected to rise to 10.9% from 10.8% in September, despite yesterday?s rebound in consumer confidence.

This rising unemployment rate is likely to further weigh on the collective economies across Europe and further keep the pressure on bank balance sheets.
We?ve already seen this week that Spanish banks will have to shed over 6,000 jobs putting further upwards pressure on the rate in that country, as well as further pressure on the non-performing loan rate.

The vote today in the German parliament is expected to give a green light to the latest Greek rescue package, however Angela Merkel won’t be getting an easy ride and it seems likely that while it may well pass it will only do so with opposition help, highlighting the continued strains the debt crisis is continuing to place on German political cohesion, as the crisis starts to nibble away at the doors of Berlin.

That would appear to be the least of the problems as cracks start to appear in the buyback program with private bond holders pushing back strongly at the prospect of another haircut, while EU governments continue to refuse to countenance one of their own.

Equity market calls
FTSE100 is expected to open 5 points lower at 5,865
DAX is expected to open 8 points lower at 7,393
CAC40 is expected to open 7 points lower at 3,562

Quelle: http://www.cmcmarkets.com

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