Deutsche, oil sell-off weighs on markets... Deutsche slump won’t trigger crisis say experts...
Deutsche, oil sell-off weighs on markets
A new low for US-listed Deutsche stocks and a sell-off of oil following recent gains are weighing on world markets so far Friday.
The massive penalty the German bank is facing from the DoJ has shaken financial institutions globally and banking stocks are suffering. A number of hedge funds said Thursday that they were reducing exposure to Deutsche but analysts says the bank’s stress tests do not raise liquidity concerns.
Asian markets closed mostly lower, led by a 1.46 per cent drop for Tokyo’s Nikkei; Shanghai was the outlier, closing with a narrow gain.
European markets have also been weakened by the banking sector with Deutsche stocks hitting a new record low for its German listing, following the record low for its US stocks. CPI data for the Eurozone is due and forecast to be slightly higher than the previous reading.
Wall Street and Toronto are expected to be subdued by global markets.
Deutsche slump won’t trigger crisis say experts
Experts are watching the woes for Deutsche carefully but have dismissed comparisons to the disaster of Lehman Bros at the start of the financial crisis.
Despite the potential $14 billion fine from the DoJ, the bank will not collapse as liquidity reserves are strong.
The CEO of financial analysts Autonomous Stuart Graham says that the current fears of a major financial institution collapsing as a result of a regulator’s fine could be good news for Deutsche:
“Does the DOJ want to run the risk of being branded by European leaders as responsible for inadvertently bringing down the fourth most systemic bank in the world?" he wrote.
A new low for US-listed Deutsche stocks and a sell-off of oil following recent gains are weighing on world markets so far Friday.
The massive penalty the German bank is facing from the DoJ has shaken financial institutions globally and banking stocks are suffering. A number of hedge funds said Thursday that they were reducing exposure to Deutsche but analysts says the bank’s stress tests do not raise liquidity concerns.
Asian markets closed mostly lower, led by a 1.46 per cent drop for Tokyo’s Nikkei; Shanghai was the outlier, closing with a narrow gain.
European markets have also been weakened by the banking sector with Deutsche stocks hitting a new record low for its German listing, following the record low for its US stocks. CPI data for the Eurozone is due and forecast to be slightly higher than the previous reading.
Wall Street and Toronto are expected to be subdued by global markets.
| Latest | 1 month ago | 1 year ago | |
| North America (previous session) |
|||
| US Dow Jones | 18,143.45 (-1.07 per cent) | -1.40 per cent | +11.41 per cent |
| TSX Composite | 14,754.55 (+0.16 per cent) | +1.07 per cent | +10.88 per cent |
| Europe (at 4.30am ET) |
|||
| UK FTSE | 6,845.14 (-0.99 per cent) | -1.02 per cent | +13.02 per cent |
| German DAX | 10,281.65 (-1.19 per cent) | -2.94 per cent | +6.43 per cent |
| Asia (at close) |
|||
| China CSI 300 | 3,253.28 (+0.27 per cent) | -2.24 per cent | +1.57 per cent |
| Japan Nikkei | 16,449.84 (-1.46 per cent) | -2.59 per cent | -5.40 per cent |
| Other Data (at 2.30am ET) |
|||
| Oil (Brent) | Oil (WTI) | Gold | Can. Dollar |
| 48.58 (-1.34 per cent) |
47.27 (-1.17 per cent) |
1329.60 (+0.27 per cent) |
U$0.7598 |
| Aus. Dollar |
|||
| U$0.7613 | |||
Deutsche slump won’t trigger crisis say experts
Experts are watching the woes for Deutsche carefully but have dismissed comparisons to the disaster of Lehman Bros at the start of the financial crisis.
Despite the potential $14 billion fine from the DoJ, the bank will not collapse as liquidity reserves are strong.
The CEO of financial analysts Autonomous Stuart Graham says that the current fears of a major financial institution collapsing as a result of a regulator’s fine could be good news for Deutsche:
“Does the DOJ want to run the risk of being branded by European leaders as responsible for inadvertently bringing down the fourth most systemic bank in the world?" he wrote.
