Shares edged up on Tuesday after the previous day’s plunge, as sentiment improved on hopes Spain will use public funds to bolster its struggling banks, although persistent worry over Greece capped gains and weighed on the euro.
European shares will likely be mixed, with financial spreadbetters predicting that major European markets .FTSE .FCHI .GDAXI would open between a 0.2 percent drop and a 0.3 percent rise. U.S. stock futures were down 0.1 percent. .EU .L .N
The anti-austerity backlash by voters in Greece and France initially caused jitters but overnight, U.S. and European stock markets showed resilience, with the banking sector outperforming, as Spain signaled it was opening the door to using public funds to aid the country’s troubled lenders.
“Spain is a much bigger economy compared with Greece or Portugal, so public funds will have to be injected because a bankruptcy scenario just isn’t an option there,” said Takao Hattori, senior investment strategist at Mitsubishi UFJ Morgan Stanley Securities in Tokyo.