Deutsche Bank drama twists and turns, but markets largely hold onto early growth
The day’s, nay week’s, drama continued to be dominated by Deutsche Bank, with investors having to try and decipher the truth from conflicting rumours about the company’s health.
While the financial firm is still up 2%, that is less than the 3.5%-pushing rise it saw soon after the bell. The reason for this contraction comes from a report by Die Zelt that the German government is working on a contingency plan in case the bank needs support. That news took Deutche Bank’s gains down to just 1%, before a counter-report from Reuters stating that the German financial watchdog Bafin wasn’t working on such a rescue plan lifted the stock back to the aforementioned 2% increase.
The fluctuations in Deutsche Bank’s price helped slightly slow down the wider gains seen by the European markets, but not by enough to cause any major issues. It seems that investors are choosing to focus on CEO John Cryan’s reassuring comments from this morning rather than the unsubstantiated rumours currently flying around. This meant the DAX and CAC both maintained a 0.8-0.9% increase, with the FTSE posting a similar 0.7% rise.
Looking ahead to the US open and the Dow Jones doesn’t appear to care much about the Deutsche Bank drama, the futures suggesting a 17 point decline after the bell. Still to come this afternoon there is the US durable goods orders reading (expected at -1.0% to last month’s 4.4%), the latest crude oil inventories figure AND a testimony from Janet Yellen, the latter of which could drag interest rates back into the spotlight.
