European stock markets were mixed, with eurozone indices falling and the U.K. benchmark rising after Britain's central bank gave lenders a post-Brexit reprieve from capital building.
The Bank of England, in its twice-yearly financial stability report, relieved lenders of the obligation to hold a so-called countercyclical capital buffer of 0.5% as it seeks to avoid a post-Brexit credit squeeze. The central bank also warned of the impact of a commercial real estate slowdown on lenders, and noted that the U.K.'s current account deficit is a source of fragility.
Meanwhile, a slew of economic data today included European Union figures that put eurozone retail sales back on a growth track in May after stagnation in April. Data also featured upward revisions to Markit's services and composite purchasing managers' indices for the eurozone in June. The indices still fell from May, however, and the services index for the U.K. declined more than expected. Markit said it is expecting second-quarter GDP growth in both the eurozone and the U.K. to halve from the first quarter, coming in at 0.3% and 0.2%, respectively.
The FTSE 100 was recently up 0.51% at 6,555.64. In Frankfurt the Dax fell 1.44% to 9,573.07 and in Paris the Cac 40 was down 1.24% at 4,182.17.
S&P 500 mini futures were down 0.44%.
The pound was recently down 0.86% against the dollar at $1.3173.
Government bond yields in Germany and the U.K. all fell, with the 10-year gilt yield recently down 3 basis points at 0.80%.
Brent crude was down 1.8% at $49.16 per barrel
Silver continued to rise and was recently up 1.03% at $19.79 an ounce. Gold slipped back 0.13% to $1,349.06.
FTSE 100-listed banks were mixed after the Bank of England report, with Royal Bank of Scotland(RBS) - Get Report and Lloyds(LYG) - Get Report both down more than 1% but HSBC(HSBC) - Get Report and Barclays(BCS) - Get Report higher. The Bank of England's removal of the mandatory capital buffer translates into about £150 billion ($197 billion) of extra lending capacity.
Real estate companies and home builders were once again among the worst performers on the FTSE 100 after Standard Life said yesterday that it has been forced to stop retail investors pulling their money out of a property fund. Home builder Berkeley Group and REITs Land Securities (LNSTY) and British Land (BTLCY) were among the decliners, and Standard Life itself was down more than 3%.
"REIT shares are now in a period of NAV [net asset value] uncertainty with downside risk as funds are forced sellers ahead of the interim earnings," Jefferies analysts said.
St Modwen Properties was recently down almost 9% after it wrote down the value of a development south of the River Thames because of falling house prices.
Apple(AAPL) - Get Report supplier and short-lived bid target Imagination Technologies (IMGTY) was down about 5% after it reported a deeper 2016 loss than expected and revealed it had breached - and then rejigged- a debt covenant with HSBC.
In Paris Iliad (ILIAY) edged lower after Bloomberg reported the wireless services operator was in exclusive talks with Hutchison and VimpelCom about buying Italian assets. The Italian wireless services units of Hutchison and VimpelCom are attempting to merge but face antitrust obstacles in Brussels.
In Milan Monte dei Paschi fell about 8% to a new record low after the bank said yesterday the European Central Bank had ordered it to deal with its bad loans. The European Commission said it was in talks with the Italian government about ways to help Italian banks without imposing losses on retail investors.
Asian stocks were mixed on Tuesday as the Australian central bank kept rates on hold and services sector PMIs pointed to slowing growth in China and a contraction in Japan.
PMI data showed a large leap in the Chinese services sector PMI, as compiled by Caixin and Markit, though this wasn't enough to prevent a fall in the overall composite index to 50.3 from 50.5. The composite reading signals the slowest growth rate for four months marked the third monthly decline in a row.
In Japan the services sector PMI fell into contraction territory, coming in at 49.4, down from 50.4, as new orders fell. The composite index fell to 49.0 from 49.2 in data which builds the case for the government of Prime Minister Shinzo Abe to bring forward an expected package of stimulus measures and for the Bank of Japan to cut rates again as early as this month.
The S&P/ASX 200 index fell 1.01% to 5,228.00 after the Reserve Bank of Australia left the cash rate unchanged at 1.75%.
The Australian dollar was recently down 1.02% against the dollar at 75.05 cents.
The Nikkei 225 was down 0.67% at 15,669.33 and the Topix was down 0.42% at 1,256.64 .
Uniqlo owner Fast Retailing was down 4.2% after it reported slowing sales growth in the domestic market.
The Hang Seng was down 1.42% at 20,760.63.
The CSI 300 was up 0.0.8% at 3,207.38.