Global news not helping mkts here: Rebecca Meehan

Nifty BSE | NSE 25/05/12 Are Mutual Funds betting on Nifty?

Rebecca Meehan of CNBC Europe has a view that that news out of the US overnight is not particularly helping the markets here.

 

Excerpts from the exclusive interview with Rebecca Meehan:

 

Q: What is the fear in the US markets? Is it essentially the effect of the FOMC minutes and the revision of the GDP figure?

 

A: Well certainly, I think that news out of the US overnight is not particularly helping the markets here. The FTSE 100 is essentially seems to be tracking lower and lower, down by about 1.6% at this stage. With the US comments that came out yesterday, not helping the markets here, but we also have some issues of our own if you like, which are really pulling the markets much lower today. Northern Rock of course has been the big story of the UK markets for several weeks now and continues to be. Today, Northern Rock actually is down almost 13% in fact at this stage. That is off the lows as of earlier in this session.

 

But Northern Rock has put out a new statement today, which doesn't appear to be helping it very much. We certainly have seen additional expressions of interest in taking over the company, in fact various options for the company.

 

But the problem is with the statement that Northern Rock put out today where they say at least one of those expressions of interest in Northern Rock is materially below the market close yesterday. Now the last time that Northern Rock said something similar was really felt as a sense of withdrawal and a similar effect seems to be happening today. Northern Rock yesterday closed at 97 and on the back of this statement this morning, it is falling even lower. Alliance as we are told has begun to talk to both interested parties about the future of Northern Rock and expect that strategic review as they are calling it to be completed by February of 2008.

 

Q: Are you seeing the pressure across the banking and financial services space?

 

A: We are certainly seeing financial services generally trading low today. As well as Northern Rock, there have been other companies like Alliance & Leicester, which has really taken a little bit of a hit, as Northern Rock has been falling. And also Barclays and HBOS (Halifax and Bank of Scotland), Bank of Scotland and some of the big financial services out here in the UK really topping those decliners list today.