EU benchmarks are trading lower due to falls in Asian shares and US Futures
Almost all EU benchmarks traded significantly lower at the beginning of the last trading day of a volatile week, following falls in Asian shares and US Futures. The sectors that saw the biggest gains on Thursday are among today’s losers, with declines led by miners, carmakers and travel and leisure shares. Risk appetite is widely down, and the cautious trading mood reflects the global uncertainty investors are now facing. Sentiment is being driven down by monetary policies, uneven corporate results, a bigger Omicron impact on economies as well as rising geopolitical tensions between the USA and Russia over Ukraine. As a matter of fact, every time a “cautious” sign is out, investors tend to reduce their exposure to riskier assets and seek safer havens like precious metals, bonds, and currencies such as the Japanese Yen and Swiss Franc, and this is exactly what’s happening now. That said, we see this week’s price action on stocks as a temporary market correction rather than a real incoming crash and benchmarks are likely to catch-up with their long-term bullish trend as soon as part or all of the current uncertainty lifts.
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