European stock exchange traded funds were on track for a higher open Friday on speculation the International Monetary Fund may get increased power to combat the debt crisis.
Markets shook off a warning from Fitch that it may downgrade several major global banks. Fitch did cut its ratings on Swiss bank UBS as well as Lloyds Banking Group and Royal Bank of Scotland. The ratings agency also put several European and U.S. banks on review, including Goldman Sachs (NYSE: GS) and Morgan Stanley (NYSE: MS).
“Fitch systematically, like many of the ratings agencies, seems to be working its way through the European banking community from the standpoint of raising awareness of potential capital inadequacies,” Adrian Miller, a strategist at Miller Tabak Roberts Securities, said in a Bloomberg report. “This is more or less a macro call on the sector. It’s a continuation of a developing theme, that’s been going on since July that, since that point, has intermittently sent shockwaves throughout the market.”
Separately, Standard & Poor’s cut Spain’s credit rating, citing concerns over the economy and banking system.