The European stocks were more or less unchanged today as the investors are anxiously waiting to see the latest developments in US over the budget deal. The US politicians are trying to come up with a solution to avoid the so called fiscal cliff, which, if actually takes place, can take US into another recession, as predicted by many economists.
The Stoxx Europe 600 Index fluctuated at least 20 times within profit – loss today and ultimately gained little less than 0.1% and is at 281.82 currently. The benchmark index has increased by 15% in 2012 so far. Not only that, but, it has also gained for the 7th straight month. The index’s rally was mainly helped by the Federal Reserve’s decision to continue with the asset purchase program and European Central Bank’s announcement of the unlimited bond buying program.
Among 12 of the 18 Western Europe markets showed increases in their respective National benchmark indexes. France’s the CAC 40 increased by 0.2%, whereas, the FTSE 100 of UK and the DAX of Germany were changed marginally.
Banque Palatine SA’s Fund Manager, Matthieu Giuliani stated that investors are not willing to take any big positions until 2012 ends. Matthieu added that US policy makers need to come up with a solution. He commented that it’s a tendency among opposition leaders to prolong decisions; however, ultimately a solution will be reached.
Coming to individual stocks, the largest maker of gas and floating oil output platforms in the world, SBM Offshore NV saw the biggest growth in the last 23 years as it is trying to settle its dispute with Talisman Energy Inc. It has climbed up by 18% and is at 10.88 Euros currently. SBM has also decided to sell 9.95% stake to HAL Investments BV so that the banking covenants can be met.
The largest bank of Switzerland, UBS AG shares, on the other hand, plummeted by 1.3%. The bank is going to face a scrutiny in Hong Kong because of certain allegations of misconducts done by the bank, related to Hong Kong’s interbank rates.
The largest maker of mobile phone networks in the world, Ericsson has gone down by 1.9% as it took the charge for writing down the actual value of ST-Ericsson. The company has also decided not to buy a full majority of the unit.