(MENAFN– ecpulse)
European shares traded lower on Thursday in early trading hours with the looming US government shutdown and debt ceiling impasse weighing on the market. Outstanding performance was also noticed for Hennes & Maurtiz (H&M) after better than expected results reported from the retailer.
Swedish Hennes & Maurtiz AB – known as H&M- the second largest retailer in Europe rallied sharply higher the most since January 2010 this morning after the retailer’s quarterly profits topped estimates.
Net income rose 22% to 4.43 billion kronor in the three months ending August beating the expected 4.15 billion. H&M shares rose about 8% to a record in Stockholm.
- H&M (HMB) was trading higher by 6.82% at 281.90 kronor setting the high of 285.00
- OMX Stockholm 30 Index traded higher by 0.83% at 1276.14
The positive news from the retailer failed to offset the general bearish sentiment in the market amid lingering worries over the impasse in Washington.
- Stoxx 600 traded lower by 0.21% at 312.36
- Stoxx 50 traded lower by 0.47% at 2913.74
The market is uncertain now about the outlook for talks among policy makers with a looming deadline for the government shutdown at the time the US approaches its statutory borrowing limit. The Congress needs to pass the short-term spending bill before October 01 to prevent a government shutdown while the Obama administration is more worried of the US failing to meet its obligations and be forced to default as the Treasury is running out of funds and will hit the debt ceiling, and policy makers need to vote on raising the debt limit that could be seen as soon as Friday.
- DAX traded lower by 0.29% at 8640.79
- CAC 40 traded lower by 0.40% at 4178.56
- FTSE 100 traded slightly lower after GDP data by 0.07% at 6546.65
UK’s ONS said the second quarter expansion was unrevised at 0.7% as expected slightly supporting FTSE, keeping the focus on the BoE as they are committed to the forward guidance and the accommodative policy to support the recovery.
Focus will be on the US third GDP reading and the expansion is expected slightly revised higher to 2.6% while the weekly jobless claims are expected to show weekly unemployment benefits rose in the previous week, keeping the focus on the frail recovery in the jobs market that is closely tied to the US monetary policy with the Fed’s threshold still set at 6.5%.
The impasse in Congress is offsetting focus from the Fed for now but remains of concern for investors and support is offered further from easing expectations for Fed tapering.
Legal Disclaimer:
MENAFN provides the information “as is” without warranty of any kind. We do not accept any responsibility or liability for the accuracy, content, images, videos, licenses, completeness, legality, or reliability of the information contained in this article. If you have any complaints or copyright issues related to this article, kindly contact the provider above.