European Stocks Open Mixed Amidst Risky Week Ahead
Following a patchy trading session in Asia, European stocks opened mixed on Monday as investors brace themselves for a risky week.
The STOXX-50 index still trades well above the 4,500.0pts mark despite its failure to clear the 4,535.0pts resistance, as gains in healthcare and industrial shares are offset by losses from the consumer non-cyclical, energy and basic materials sector.
The market lacks direction for the first exchanges of this new trading week, and investors are waiting for an extremely busy macro calendar in the next few days.
In addition to the new batch of key macro data such as PMIs and inflation rates, traders will pay close attention to the decision on rates from the US, EU and UK this week.
This week's challenge for investors will be to confirm their hopes of a monetary dovish turn to come. Many have already priced it in, and this sentiment still prevails even if the solid US employment data seen last Friday has slightly tempered the amplitude of rate cut expectations.
Volatility will likely increase significantly throughout the week, even though most benchmarks remain well-oriented.
The STOXX-50 index still trades inside its mid-term bullish channel, with both moving averages rising, while the DMI shows a directional price action inside a bull environment.
The 4,610.0pts zone should be seen as a strong resistance level if the market clears the 4,535.0pts and 4,55.0pts marks.
Pierre Veyret – Technical analyst, ActivTrades
The STOXX-50 index still trades well above the 4,500.0pts mark despite its failure to clear the 4,535.0pts resistance, as gains in healthcare and industrial shares are offset by losses from the consumer non-cyclical, energy and basic materials sector.
The market lacks direction for the first exchanges of this new trading week, and investors are waiting for an extremely busy macro calendar in the next few days.
In addition to the new batch of key macro data such as PMIs and inflation rates, traders will pay close attention to the decision on rates from the US, EU and UK this week.
This week's challenge for investors will be to confirm their hopes of a monetary dovish turn to come. Many have already priced it in, and this sentiment still prevails even if the solid US employment data seen last Friday has slightly tempered the amplitude of rate cut expectations.
Volatility will likely increase significantly throughout the week, even though most benchmarks remain well-oriented.
The STOXX-50 index still trades inside its mid-term bullish channel, with both moving averages rising, while the DMI shows a directional price action inside a bull environment.
The 4,610.0pts zone should be seen as a strong resistance level if the market clears the 4,535.0pts and 4,55.0pts marks.
Pierre Veyret – Technical analyst, ActivTrades