GO
Loading...

Europe Stocks Seen Falling After Slovakia Euro Fund Vote

European stocks were expected to open lower on Wednesday after closing down on Tuesday, ending a four-session rally and following news from Slovakia that the country's parliament has delayed a vote on the European Financial Stability Facility (EFSF).

Comstock | Getty Images

The FTSE was called 36 points lower, the CAC 40 in Paris was predicted to be down by 17 points and the DAX was called lower by 39 points.

The Slovak parliament rejected the extension of the 440 billion euro zone bailout fund in its first vote, with junior coalition party, the Freedom and Solidarity Party (SaS) abstaining after days of negotiations. Outgoing Prime Minister Iveta Radicova, who had tied her government's fate to the passing of the vote, has called on the opposition to help and hopes the vote will still pass by the end of the week. Leftist opposition party Smer said on Tuesday support for the government over the EFSF would be dependent on a number of political concessions.

The wrangling in Slovakia dented investor sentiment in Asia overnight and a warning from US aluminium producer Alcoa that the sluggish global economy meant the price of the metal had fallen came as unwelcome news ahead of US earnings season.

The euro fell in Asian trading on Wednesday reversing a recent rally ahead of the Slovak parliament vote. The common currency last stood at $1.3613, down 0.25 percent against the dollar and against the yen the euro was down 0.2 percent.

European Commission President Jose Manuel Barroso will address the European Parliament on Wednesday, where he is expected to provide further details on plans to recapitalize struggling euro zone banks. Barroso will speak in Brussels at 14:00 London time.

Corporate releases on Wednesday include Dutch semiconductor firm ASML Holding.

Luxury fashion brand Burberry will release second quarter figures on Wednesday, but revenues could be stifled by slowing Chinese growth and fears of a return to recession in Europe. Shares in the British brand peaked in July, but have fallen by as much as 25 percent, with concerns over the previously lucrative Chinese market.

UK unemployment figures are announced at 9:30, followed by EU industrial production data at 10:00.

The IEA oil market report will be available from 9:00 London time.

Contact Europe: Economy

  • CNBC NEWSLETTERS

    Get the best of CNBC in your inbox

    › Learn More