Market Analysis

Equity benchmarks traded higher in Europe despite patchy performances in Asia

EUROPEAN SHARES 
Equity benchmarks traded mostly higher in Europe on Friday, despite patchy performances in Asia as investors digested mounting uncertainties around Russia-Ukraine talks. Even if the war in Ukraine continues to fuel market volatility as well as cross-asset rotation trading, risk appetite seems to keep prevailing in Europe as share markets are set to register their best week since 2020. While investors are still welcoming the clarity the Federal Reserve brought with its hawkish shift in monetary policy, the easing of fears about a Russian default on the payment of interest on two dollar-denominated bonds also provided a fresh boost to market sentiment. That said, the economic/military conflict with Russia is far from over, especially after the US has revoked all trade deals it had with Moscow while President Putin kept the nuclear threat alive. Investors are likely to cautiously monitor the key discussions between the US and China, as Presidents Biden and Xi Jinping are set to meet later today to discuss Beijing’s involvement in the war, for the first time since the beginning of the conflict. No clear directional price action will be expected today as traders will also have to brace for a triple witching day in addition to the complicated geopolitical context, which should drive market volatility higher, providing a complicated set-up to very short-term investor.

Pierre Veyret– Technical analyst, ActivTrades

Source: ActivTrader

 

OIL

WTI oil prices rose during early Friday trading, carrying the momentum initiated during the previous session. The price of the barrel gained almost 8% on Thursday, once again rising above $100 per barrel, as talks between Russia and Ukraine stalled, dissipating some of the hope felt earlier in the week, that diplomatic efforts could lead to a de-escalation of the conflict. The uncertainty created by the prospect of a protracted conflict, which may lead to stricter sanctions on Russian oil exports, is behind the latest escalation in prices and is likely to continue to condition the sentiment of traders, with more volatility expected in the weeks ahead.

Ricardo Evangelista – Senior Analyst, ActivTrades

Source: ActivTrader

 

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