Stoxx 600 with first quar­terly gain of the year

Malta Independent - - BUSINESS & FINANCE -

Shares of Euro­pean lenders rose on the fi­nal day of a trou­bled week, eras­ing de­clines af­ter Deutsche Bank AG swung to gains amid eas­ing in­vestor con­cern about its fi­nan­cial health.

The Stoxx 600 Banks In­dex ad­vanced 0.6 per­cent at the close, re­vers­ing an ear­lier slide of 3.8 per­cent. Deutsche Bank erased a drop of as much 9 per­cent to rise 6.4 per­cent af­ter a re­port it’s near­ing a $5.4 bil­lion set­tle­ment with the U.S. Depart­ment of Jus­tice, less than half an ini­tial re­quest. The lender, which tum­bled on Mon­day amid con­cerns about its cap­i­tal buf­fers, fell anew ear­lier on Fri­day af­ter a re­port that hedge funds moved to cut their ex­po­sure to it.

It’s been a rough week for Euro­pean lenders, with wor­ries about Deutsche Bank fol­lowed by job cuts at Com­merzbank, a $1.1 bil­lion law­suit set­tle­ment for Royal Bank of Scot­land Group Plc and prospects of cost re­duc­tions at Credit Suisse Group AG. The Swiss lender has fallen 3.2 per­cent this week, while Com­merzbank is down 9 per­cent, the big­gest drop among peers.

The bank­ing in­dex has fallen 1 per­cent this week and is down 2.7 per­cent in Septem­ber, as a re­bound from a four-year low in July ran out of steam. That soured its best quar­terly ad­vance since March 2015. The Stoxx 600 fell 0.7 per­cent this week, trim­ming its first quar­terly gain of the year to 4 per­cent.

Oil trimmed a sec­ond monthly gain on OPEC’s plan to re­duce out­put for the first time in eight years. Prices are up 5.8 per­cent for the month, head­ing for the first Septem­ber in­crease since 2010. Iran will be ex­empt from the cuts and an OPEC com­mit­tee will rec­om­mend pro­duc­tion caps for mem­bers at a for­mal meet­ing in Novem­ber af­ter the deal was an­nounced Wed­nes­day. The agree­ment rep­re­sented a “ca­pit­u­la­tion” to U.S. shale drillers, ac­cord­ing to War­wick En­ergy Group, a pri­vately held in­vestor in thou­sands of oil wells. The jump in oil weighed on air­lines.

This ar­ti­cle was com­piled byVal­letta Fund Man­age­ment Lim­ited, a mem­ber of the BOV Group.Val­letta Fund Man­age­ment,TG Com­plex, Suite 2, Level 3, Brew­ery Str., Mriehel BKR 3000 Freep­hone: 80072344. E-mail: in­fovfm@bov.com. Web­site: www.vfm.com.mt. Val­letta Fund Man­age­ment Lim­ited is li­censed by the MFSA. This doc­u­ment is is­sued by Bank of Val­letta p.l.c. (BOV) for in­for­ma­tion pur­poses only. This doc­u­ment is not and should not be con­strued as an of­fer or rec­om­men­da­tion to sell or so­lic­i­ta­tion of an of­fer or rec­om­men­da­tion to pur­chase or sub­scribe for any in­vest­ment. The Bank has ob­tained the in­for­ma­tion con­tained in this doc­u­ment from sources it be­lieves to be re­li­able but it has not in­de­pen­dently ver­i­fied this in­for­ma­tion con­tained herein and there­fore its ac­cu­racy can­not be guar­an­teed. The Bank makes no guar­an­tees, rep­re­sen­ta­tions or war­ranties and ac­cepts no re­spon­si­bil­ity or li­a­bil­ity as to the ac­cu­racy or com­plete­ness of the in­for­ma­tion con­tained in this doc­u­ment. The Bank has no obli­ga­tion to up­date, mod­ify or amend this re­port or to oth­er­wise no­tify a reader thereof in the event that any mat­ter stated therein, or any opin­ion, pro­jec­tion, fore­cast or es­ti­mate set for the herein changes or sub­se­quently be­comes in­ac­cu­rate. Past per­for­mance is not nec­es­sar­ily in­dica­tive of fu­ture re­sults. Bank of Val­letta p.l.c. is li­censed to con­duct in­vest­ment ser­vices by the Malta Fi­nan­cial Ser­vices Author­ity. Source: Bank of Val­letta plc, 15:55 hrs

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