European stocks still have Brexit blues
BEIJING — European stock markets slipped yesterday, despite gains earlier in Asia, as investors awaited more clarity on Britain’s future outside the European Union and a U.S. holiday kept trading volumes thin.
KEEPING SCORE: Germany’s DAX fell 0.7 percent to close at 9,709.09 and France’s CAC 40 shed 0.9 percent to 4,234.86. Britain’s FTSE 100 dropped 0.8 percent to 6,522.26. While Wall Street was closed for the Fourth of July holiday, the Shanghai Composite Index rose 1.9 percent to 2,988.60 and Hong Kong’s Hang Seng gained 1.3 percent to 21,059.20. Tokyo’s Nikkei 225 advanced 0.6 percent to 15,775.80 and Sydney’s S&P-ASX 200 gained 0.7 percent to 5,281.80.
POST-BREXIT STIMULUS: Investor sentiment was boosted last week by expectations the Bank of England and European Central Bank might provide monetary stimulus to shore up growth after Britain’s vote and the U.S. Federal Reserve might postpone a rate hike. The top British central banker, Mark Carney, said that some form of stimulus “will likely be required over the summer” because the economic outlook has deteriorated.
EUROPEAN JITTERS: But the momentum in stock markets did not last in Europe, as the prospect of low interest rates for longer has hurt financial stocks. Banks take a hit to their earnings when interest rates are low, because they cannot lend money at higher, more profitable rates.
ENERGY: Benchmark U.S. crude shed 13 cents to $48.86 per barrel in electronic trading on the New York Mercantile Exchange. The contract gained 66 cents on Friday. Brent crude, used to price international oils, dropped 18 cents to $50.17 in London.
CURRENCY: The dollar edged up to 102.51 yen from Friday’s 102.49 yen. The euro rose to $1.1146 from $1.1139, and the pound was roughly flat at $1.3295.