European Indices largely flat-negative - ADP eyed

Nick Serff, Market Analyst, City Index commented: "European share indices hovered around unchanged in early trade on Wednesday after Greece decided on extra austerity measures of 4.8 billion Euros to help meet its fiscal targets.

It has been a relatively quiet morning with investors taking a bit of a pause for breath after recent gains and are awaiting further clues on how the US labour market is recovering.

Sentiment has been given a lift on the extra austerity measures announced by Greece. The Greek cabinet announced the move after growing pressure to reduce its deficit from the European Union. The money will come from a mix of spending cuts and tax hikes with the rate of VAT expected to increase to 21 percent.

The price of the Euro jumped on the back of the news as investors added a touch more risk to their positions: gold was one of the main beneficiaries rallying to a fresh 6 week high.

The price in Standard Chartered shares rose over 2.5 percent after releasing full year numbers ahead of expectations. 2009 Pre tax profits were £3.4 billion, up 13 percent from the previous year on continued growth in China and India. The bank also said that after the seventh successive record year of profits it was paying staff bonuses to keep hold of its best talent.

US ADP Employment figures due for release later this afternoon will be closely watched by investors for clues to Fridays US Non Farm Payroll data. The number is forecast to come in down 20,000 and so this figure, along with ISM non manufacturing could play a role in how European equities finish the afternoon."

For more information, visit ciyindex.co.uk.