The day started with ECB lending 489 Billion Euro (645 Billion US dollar) to 523 banks at 1% interest rate, while forecast was that bank will need 293 Billion Euros.This raises question that there are far more banks who needed money then estimated. A similar program was announced in June 2009 in which bank borrowed 442 B euros.
Similar program was launched during the 2008 crisis, where Fed gave stimulus of $295 Billion to National and Foreign bank including names like Bank of america and Citibank and so on. So now you can compare how big stimulus European bank has taken from ECB in last two year and yet its not even enough to solve their problem. This also raises question about ECB further participation in buying bond after such a big lending program to bank, which means bond yield of Italy and Spain might rise.
Apart from this, top 3 France Bank is still struggling to raise $37 Billion euros in their first quarter. You can read further here.
A possible downgrade of France is going to make thing even worse for them.
European Economic Data:
Italian sales (4 EST): -0.2% is expected, higher is bullish sign, lower is bearish sign.
UK GDP (4.30 EST): 0.5% is expected, higher is bullish sign, 0 or negative is very bearish sign.
US Economic Data:
Jobless claim: 380k is expected, lower will be bullish sign, higher then 360k is bearish sign.
US GDP: 2% is expected, lower will be bearish sign, higher is bullish sign.
Consumer sentiment: expected is 68, higher is bullish sign, while lower is bearish sign.
Friday: France GDP is very important and lots of economic data coming out from US and Europe will decide the fate of stock market.
This days bad news is considered good news and market rallies up or atleast end up flat.
I think market will open low and there will be continuous pressure of sell off unless some great GDP number comes out which's impossible.
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