EU and Asian markets up from Spain banks deal
Published: 11 Jun at 6 PM
Both the euro and global stock markets gained in Asia following a deal to help Spain's troubled banks, which eased worries over a break up of the euro.
In Asia, the euro went up 1% against the Japanese yen and US dollar. Stock indexes in Hong Kong and Japan also rose 2%.
Last Saturday, EU ministers agreed to loan Spain a maximum of 100 billion euros to bail out its banks. Experts said the agreement would buy some time for policymakers to resolve other issues facing the 17-country eurozone.
The largest issues now are the June 17 Greek elections, and the anxiety that an anti-eurozone political party may end up controlling the show.
Everyone is still eyeing Greece's upcoming elections, although investors' fears over the currency have eased for the short term, explains Andy Du from Orient Futures Derivatives.
Stephen Davies from Javelin Wealth Management says the fact that Spain’s banking bailout was larger than many people originally expected indicated even more strain within the EU banking system.
It all reveals the grave situation within which the EU continues to find itself, added Davies. Following the breakdown of a property boom and the ensuing recession, Spain's weakest financial institutions ended up with billions of euros in bad loans.