European Factors to Watch-Shares to rebound but set for weekly drop

Fri Jun 27, 2014 2:37am EDT

(Adds details, futures)
    EDINBURGH, June 27 (Reuters) - European stocks were set to open slightly
higher on Friday, rebounding from recent falls but still set for their biggest
weekly drop since April to pull back from multi-year highs, hindered by talk of
rate rises in the United States amid global growth concerns.
    The pan-European FTSEurofirst 300 is down 1.7 percent for the week,
and looks set to snap a 10-week winning streak, which had been its longest since
the middle of 2012.
    The index closed down 0.1 percent at 1,370.38 on Thursday, retreating
further from a 6-1/2 year high hit last week after U.S. Federal Reserve official
James Bullard suggested the U.S. economy would be strong enough to bear a rate
rise in early 2015. 
    The comments came despite weak U.S. consumer spending data, which prompted a
cut in growth forecasts and hit global stocks. 
    "Bullard's statement (has) illustrated the high dependency of the stock
markets on further low interest rates," Roger Peeters, head of research at Close
Brothers Seydler, said in a note.
    At 0630 GMT, futures for the Euro STOXX 50, Britain's FTSE 100
, Germany's DAX and France's CAC were up 0.3-0.4 percent.
    Even as the Federal Reserve publically discusses monetary tightening,
European shares are set to be underpinned throughout the second half of 2014 by
stimulus from the European Central Bank.
    A Reuters poll of over 60 fund managers and strategists taken in the past
week predicted the pan-European STOXX Europe 600 index would climb 5
percent to 360 points by the end of 2014 - a seven-year high - led up by
periphery markets that should benefit the most from attempts to stave off
inflation. 
    The financial sector may be in focus on Friday, with big banks starting to
pull business out of Barclays' dark pool after the British bank was
sued by New York's top securities regulator for allegedly misleading investors
over its anonymous trading venue, the Financial Times reported. 
    "While we expect some revenues will now be lost, as clients instruct brokers
to pull direct flow away, there should be limited impact on the rest of the
equities business, in our view," analysts at Citi said in a note, pointing out
that the revenue contribution from Barclays' dark pools business was
"negligible".
    
    Europe bourses in 2014: (link.reuters.com/pad95v)
    Asset performance in 2014: (link.reuters.com/rav46v)
------------------------------------------------------------------------------
  MARKET SNAPSHOT AT 0630 GMT: 
     
                                          LAST  PCT CHG    NET CHG
 S&P 500                              1,957.22  -0.12 %      -2.31
 NIKKEI                                  15095  -1.39 %    -213.49
 MSCI ASIA EX-JP                        492.27  -0.06 %      -0.28
 EUR/USD                                1.3624    0.1 %     0.0013
 USD/JPY                                101.38  -0.34 %    -0.3500
 10-YR US TSY YLD                        2.518       --      -0.01
 10-YR BUND YLD                          1.246       --       0.00
 SPOT GOLD                           $1,320.30    0.2 %      $2.70
 US CRUDE                              $105.59  -0.24 %      -0.25
 
    
  > GLOBAL MARKETS-Shares, bond yields down on growth concerns    
  > US STOCKS-Wall St dips after Fed's Bullard talks about rates    
  > Nikkei falls on U.S. growth concerns; exporters weak        
  > TREASURIES-Long yields hit three-week lows on soft U.S. data     
  > FOREX-New Zealand dollar shines in subdued currency market    
  > PRECIOUS-Gold treads water; Chinese physical demand weighs    
  > METALS-London copper slips; set for 2nd weekly gain         
  > Brent heads for biggest weekly drop since March             
    
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    BARCLAYS, CREDIT SUISSE 
    Big banks have started pulling their business out of Barclays' dark
pool, after the British bank was sued by New York's top securities regulator for
allegedly misleading institutional investors over its anonymous trading venue,
The Financial times reported.
    Credit Suisse, Deutsche Bank, and Royal Bank of Canada,
asset manager Alliance Bernstein were among the institutions that withdrew from
Barclays' dark pool on Thursday, the paper said.
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 (Reporting by Alistair Smout; Editing by Gopakumar Warrier, Sunil Nair and
Sudip Kar-Gupta)