Market Update
Shares in Europe were trading choppy early Thursday, after Portugal became the third European-Union nation to seek a bailout, even as markets braced for widely-expected interest-rate hike by the European Central Bank at its meeting today.
At 12:45 p.m. (I.S.T.), Britain's FTSE and Germany's DAX were trading flat, while France's CAC edged up 0.3%.
On Wednesday, Portugal said it would need "assistance" after bond sales carried out earlier in the day showed borrowing costs for the nation had surged, and with the country's parliament having rejected an austerity plan.
The European Central Bank today is tipped to hike interest rates for the first time since 2008, after E.C.B. chief Jean-Claude Trichet spoke about it in an interview last month, with economists expected a 25 basis-points hike. Markets would, however, look into comments from the central bank as to when a further rate hike would be due in the future and the E.C.B. is expected carefully weigh the impact of more rate hikes on struggling European nations.
In the markets, banks witnessing buying, as investors got a relief after the Portugal appeal for aid: Barclays, BNP Paribas, Credit Agricole and Societe Generale rose 1% to 2%. Portuguese banks outperformed the most with Banco Espirito Sanco surging about 9%.
Miners BHP Billiton, Rio Tinto, Anglo American and Xstrata, however, slipped 0.6% to 0.8%.
Elsewhere, Asian stocks were trading close to the flat line with China and Japan markets marginally positive while India and Hong Kong indexes were slightly in the red.