E.U. markets end the week on a low note
Posted May 14, 2010 5:39 pm.
This article is more than 5 years old.
After the trillion dollar bailout package put European investors in a buying mood earlier this week, the markets fell as the business day wrapped up on Friday.
Markets had originally jumped on the news of the bailout to help the battered Euro and debt-ridden countries, but with the realization that the financial problems will take years to fix, investors are reassessing the situation and thinking long-term.
“We’re now into the stage where the market and the Euro are coming to grips with a very very weak economical look for Europe, ” said Doug Porter, deputy chief economist at BMO Capital Markets.
“The bigger picture really has not changed here, and that is that […] the U.S. to some extent, but especially Europe – faces a very real fiscal challenge that’s going to be with them for years,” he told 680News on Friday.
Analysts have said that the bailout still requires cost cutting in selected countries, supporting the perception that commodity demand will weaken in Europe. This, in turn, has hurt the commodity heavy TSX.
Porter said the issue of government debts and deficits will linger, but hopefully the volatility in the markets will ease in the future.
