Yahoo Finance Catalonia Will Not Back Down which is Weighing on Spanish Stocks
European stock markets are mostly slightly higher. The DAX is leading the way and is once again trying to clear the 13000 mark amid a weaker EUR and rising commodity prices. The FTSE 100 is still managing a small gain, but the Spanish IBEX is underperforming as the conflict between Catalonia and the central government in Madrid threatens to escalate. Cautious trade in Europe followed a largely positive session in Asia overnight, where a stronger Dollar and rising U.S. yields helped most markets to move higher. The CSI 300 underperformed amid caution ahead of the Communist Party congress this week, but the Hang Seng outperformed with a 0.76% gain. Oil prices climbed above USD 52 per barrel and U.S. stock futures are also moving up.
Catalonia Refuses to Back Down.
Faced with an ultimatum from Rajoy to clarify whether the autonomous region declared independence accept the Spanish constitution, Catalonia’s President Puigdemont defended the region’s claim to independence and once again called for dialogue. In a letter to Rajoy Puigdemont insisted that the illegal referendum from October 1 gave his government “a democratic mandate to declare independence”. The letter was once again pretty vague on whether independence had been declared or now and fell short of what Rajoy was expecting, which could see the central administration in Madrid taking steps to take over direct control in Catalonia.
The Eurozone posted a trade surplus of EUR 21.6 billion in August, up from EUR 17.9 billion in the previous month, as export growth outstripped import growth. The unadjusted surplus amounted to EUR 16.1 billion, bringing the total for the year to date to EUR 145.3 billion, down from EUR 172.2 billion in the first eight months last year. This is nominal data, impacted by oil prices and exchange rate developments, but still the numbers highlight that overall this is a recovery led by domestic demand and consumption, rather than external growth.
Austria moves to the right in general election. The centre-right OeVP won yesterday’s general election, but the right wing FPOe gained and came second, which will likely see it becoming junior coalition partner in a OeVP led coalition. However, this is not the first time, that the FPOe will enter a government and unlike in Germany where the AfD is a new party on the political landscape the FPOe has long been part of Austria’s political life. Furthermore the OeVP has made a pro-EU stance a condition for a cooperation, although with the prospect of the FDP entering government in Germany and the new administration in Austria the chance for Macron’s and Juncker’s plans for more centralized decision making are fading quickly.
This article was originally posted on FX Empire
