Italian Prime Minister Matteo Renzi announced his resignation after voters in a national referendum soundly rejected his proposed constitutional reforms. After Renzi's announcement, the euro dropped to a 20-month low and European stock markets were poised for a weak start.
Now that Hong Kong has stock-trading links with Shenzhen and Shanghai, it plans to develop links with China's markets for initial public offerings and the trading of bonds and commodities, said Charles Li, CEO of Hong Kong Exchanges and Clearing. Hong Kong's links with China may be set up in ways that are different from the stock-trading schemes, he said.
The failure of Italy's referendum is expected to make it more difficult for its troubled banks to be recapitalised. "This outcome is likely to exacerbate concerns about the Italian banking sector and increase downgrade risks from rating agencies such as DBRS, although we do not expect rating agencies to act anytime soon, as they are likely to wait for political developments before taking any rating decision," according to Barclays.
Finance ministers from the eurozone will try to agree on Greek economic reforms when they meet today in the hope of securing International Monetary Fund support for the country's next bailout. German Finance Minister Wolfgang Schaeuble has rejected debt relief for Greece, saying it must implement reforms or leave the eurozone.
EU ministers are expected to approve a draft statement backing the overhaul of Europe's bankruptcy laws and other measures in an effort to eliminate "bottlenecks to investment". While indicating support for changes to EU insolvency laws, the statement doesn't go as far as a recent European Commission proposal streamlining bankruptcy procedures.
The European Commission is expected to reveal its objections to the proposed merger of Deutsche Boerse and London Stock Exchange Group on 13 December. Commission officials have raised concerns about how the deal could hurt competition in derivatives dealing, clearing and other areas.
Poland has won the support of 13 EU member states to oppose rules that would force data to be stored in designated nations. In a joint letter to the European Commission, the countries backed protection for the free flow of data throughout the EU.
The trading link between Hong Kong and Shenzhen launched today, with 1.35 billion yuan of northbound trading and HK$442 million of southbound trading recorded before noon. The volume is less than that seen in the link's 2-year-old Shanghai counterpart, but was lauded as a promising start.
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