Europe Turns its Focus on the Finance Ministers Meeting

By FX Empire.com

Although investors continue to be optimistic over Europe’s boosted efforts to solve the widening debt crisis, anxiety and cautions is keeping markets unstable, with no clear direction, awaiting the results of the European finance ministers meeting today in Brussels, during which they might boost the EFSF program.

While the Asian stocks rallied today, with Nikkei 225 rising 2.30% while Hang Seng rose 1.21%, on hopes solving the debt crisis might ease the downside pressures imposed on the Asian economies, stocks in Europe are falling with FTSE 100 down 0.52%, and CAC 40 down 1.1%.

Concerns were reignited in Europe after Moody’s said it considers downgrading the debt rating for banks in 15 European nations, while S&P said it may cut the outlook for France’s AAA rating to negative in the next 10 days. Fitch on the other hand warned from a possible downgrade to US’s AAA credit rating.

Italy, Belgium and Malta are preparing today for a bond auction, with Italy selling 8 billion euros of bonds. The OECD said yesterday that Europe is already in a mild recession, and expressed its growing fears from Europe’s incapability to save the monetary union.

Since uncertainties continue to be high, the rallies seen in Asia proved be short lived. Markets await today the business climate and consumer confidence reports from Europe, while the US will release its consumer confidence for Nov. which may rise from the lowest in two years to 44.4 from 39.8 previous.

The euro is almost unchanged as of this writing trading around 1.3319, awaiting the results of the European finance ministers meeting. The pound climbed today trading around 1.5550 before George Osborne presents his Autumn Statement during which he might announce further stimulus.

The yen was stronger today trading around 77.86, since the US dollar fell slightly, trading as of this writing around the 79.05 level. Oil is almost unchanged trading around $97.78 per barrel, while gold fell $1706.50 per ounce, on mixed sentiment ahead of finance ministers meeting.

Originally posted here