The European stocks growth is constrained by Greek issue

02.07.2015

On Thursday, European stock indexes opened with moderate growth, but it is likely to remain limited, as the continued uncertainty regarding the possibility of an agreement to rescue Greece continued to weigh on market sentiment.

During European morning trade, the STOXX EURO 50 rose 0.24%, the French CAC 40 rose 0.27%, while Germany's DAX 30 added 0.21%.

Sentiment deteriorated after Wednesday, Greek Prime Minister, Alexis Tsipras, urged voters to vote in a referendum on Sunday against the conditions proposed by the creditors to prolong the rescue program.

Less than a day before this, Tsipras wrote a conciliatory letter to creditors with a request for a new financial assistance, ready to take on most of their conditions.

On Wednesday, Greece was the first country with a developed economy, defaulted because it could not repay the debt to the International Monetary Fund on Tuesday evening. The IMF has confirmed that the Greek government is not able to list the planned payment of 1.6 billion euro to repay the loan at the close of trading on Tuesday.

Earlier on Thursday, data showed that the number of unemployed in Spain fell last month by 94700, compared with expectations of a decline of 124000. In May, the number of unemployed fell 118000.

The financial sector has been mixed. Thus, French lenders BNP Paribas (PARIS: BNPP) and Societe Generale (PARIS: SOGN) rose 0.16% and 0.07%, while the German Commerzbank (XETRA: CBKG) and Deutsche Bank (XETRA: DBKGn) went up 0.35% and 0.60%.

Among the peripheral lenders, Italian Unicredit (MILAN: CRDI) and Intesa Sanpaolo (MILAN: ISP) fell 0.16% and 0.34% respectively, while the Spanish Banco Santander (MADRID: SAN) and BBVA (MADRID: BBVA ) lost 0.03% and 0.15%.

Shares of Electrolux (ST: ELUXa) tumbled 9.43% after the announcement that the company is ready to deal with the Antimonopoly Committee for the United States to acquire the technical division of General Electric (NYSE: GE) Co. for $ 3.3 billion by year's end.

London's FTSE 100 lost 0.01%, being under pressure of Intertek Group shares (LONDON: ITRK), which fell 2.25% after Jefferies Group lowered its rating to "underperform."

The financial sector also decreased. For example, shares of Lloyds Banking (LONDON: LLOY) fell 0.07%, shares of Barclays (LONDON: BARC) fell 0.18%, while shares of Royal Bank of Scotland (LONDON: RBS) fell 0.28 %. Shares of HSBC Holdings (LONDON: HSBA), by contrast, rose 0.60%.

The mining sector shows a decline. Stocks of Glencore Xstrata (LONDON: GLEN) lost 0.40%, shares of Rio Tinto (LONDON: RIO) fell 0.58%, while shares of Bhp Billiton (LONDON: BLT) fell 0.60%, and shares of Fresnillo (LONDON: FRES) fell 1.21%.

In the US, equity markets pointed to a higher open. Futures on the Dow Jones Industrial Average indicate a rise of 0.22%, futures of the S & P 500 indicates a 0.20% increase, while the Nasdaq 100 futures rose 0.24%.

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