European markets open lower

An altogether more repressed sentiment prevails today, as disappointing earnings from the global technology sector threaten to take the wind out of the stock market sails.

The London benchmark is currently anchored around the pivotal 6600 mark.

European markets have thus failed to emulate their record-high US counterparts, opening lower and pulling back considerably from the highs wrought yesterday afternoon. However the outlook hike for the US from Moody’s credit rating agency, and new highs in the Dow Jones Industrial Index coinciding with the declared bankruptcy of the City of Detroit, serve to remind us of the fragility of the American recovery, as well as begging the question of the relevance of sovereign debt ratings.

Fresnillo has been one of the worst performers in the FTSE 100 year-to-date, falling over 50% until the bounce in late June. Despite the price target hike yesterday from Deutsche Bank, the shares have given up 2.5% in early trade.

A 3.5% drop in service revenue for Vodafone, with its biggest European market Germany declining by 5.1%, has had little downside effect on the company’s share price. The stock is up 0.3% as investors bank on decent dividend pay outs in the coming year.

Spain saw house prices fall by 7.6% in the second quarter, down from the previous year. This will be likely to exacerbate non-performing loans at Spanish banks, which have been under increased duress as the difficult economic outlook weighs down.

The G20 meetings kick off today. Key agenda items are expected to address growth problems and measures to reducing unemployment. We can also expect to see a great degree of focus on establishing methods to counteract the tax loopholes used by multi-national companies.

The Dow is set to open down 43 points at 15,503.

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