Stockholm stock market recovers lost ground

The Stockholm stock exchange dropped by 4 percent at the opening of trading on Friday morning, but had recouped the losses by the afternoon amid mounting fears about the the global economy..

While Stockholm’s OMX 30 index recovered slightly by mid-morning, the exchange as still down 3.3 percent at 10.30am, reaching its lowest level since October 2009.

By 2pm, the exchange had recovered from morning loses and was only slightly done for the day.

After a 4.6 percent drop on Thursday, the exchange is down more than 10 percent for the week.

Stock markets across Europe experience drops on Friday morning, with the Franfurt exchange down 4 percent in opening trading, while the Milan stock market dipped 3.5 percent and shares in London were down 2.9 percent.

The dip in European markets comes following large losses in Asian exchanges overnight, as well as a decline in stock exchanges in New York on Thursday which were the worst in nearly two years.

Since the start of the year, the Stockholm stock market has lost roughly 20 percent of its value.

According to a new forecast from the SEB bank, concerns about a weaker global economy as well as intensfying problems in the eurozone will likely force the European Central Bank to tone down the need for interest rate hikes in the coming months.

However, SEB’s morning analyst report projects that the Riksbank will raise interest rates in September, and perhaps one more time during the year.

Håkan Frisén, head of economic research at SEB, cited a number of factors for the current stock market slump.

“You have a worsening crisis in Spain and Italy as well as differing views on what to do next to deal with the eurozone crisis,” he told The Local.

“We’ve had more bad news about the long-term sovereign debt crisis in Italy and policy makers aren’t prepared to address the problem.”

Other concerns weighing on global markets include disappointing figures in the United States’ housing and labour markets in recent months, as well as increasing concerns about the strength of the US economic recovery.

He added that the Stockholm market had been “under-performing” other stock markets for “a long time”.

“Swedish companies have more exposure to the global economy,” he said.

“And Sweden’s strong currency keeps pressure on profits.”

According to Frisén, Sweden’s “strong domestic foundation” has kept the krona strong.

“But if the crisis continues and gets worse, a somewhat weaker currency could help Swedish companies,” he said.

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Stockholm stock exchange suffers worst day of 2018

The Stockholm stock exchange plunged by 2.8 percent on Thursday, making it the worst trading day of 2018.

Stockholm stock exchange suffers worst day of 2018
File photo: Stina Stjernkvist/TT
Stock markets across Europe suffered for the third day in a row as the arrest of a top Huawei executive in Canada has raised the spectre of an all-out trade war between the US and China.
For the Stockholm Stock Exchange, it meant a blood-red trading day that ended as the worst of the year thus far. The OMXS Stockholm 30 index fell by a combined 2.8 percent.
The majority of the companies on the index lost value, with the exception of Ericsson, which seemed to benefit from the news about its Chinese competitor Huawei with a 1.8 percent increase. Airline SAS also saw its stock increase, rising 4.2 percent thanks to sharp declines in oil prices. 
Among Thursday’s biggest losers was the mining company Boliden, which suffered a 6.1 percent drop. The stock of the Stockholm-based tech company Hexagon fell 5.6 percent.
Meanwhile, the stock of Swedish auto safety equipment manufactor Autoliv fell 6.1 percent on the news that it expects to pay some 1.8 billion kronor in fines as a result of an European Commission investigation into anti-competitive behavior in the EU. 
Stockholm was far the only European bourse to have a gloomy Thursday. The CAC index in Paris fell 3.3 percent, the DAX index in Frankfurt dropped 3.5 percent and the London Stock Exchange's FTSE index decreased by 3.2 percent.