Market Analysis

European stocks reach moderate gains due to positive market sentiments

EUROPEAN SHARES 
European stocks climbed at the start of this new week, extending gains registered during the Asian session overnight as risk appetite continues to grow globally.

Most indices have established new short-term floors following last week’s break-out of several intermediate resistance levels, and are now heading to new monthly tops as the bullish correction of late August’s sell-off continues.

It is interesting to note here that riskier assets continue to edge higher while the Euro currency is taking off as well. This is very unusual considering the fact that a more expensive Euro would normally put pressure on the large exporting groups of the STOXX-600 and STOXX-50 indexes, but this is not what we are seeing here.

It seems that European indices are being pushed higher by a global improving sentiment while traders also took the occasion to buy a potential dip on the EU currency following the start of the interest rates hike cycle by the ECB last week.

However, that said, traders are also bracing for policy-sensitive macro data such as the US CPI tomorrow, UK CPI on Wednesday as well as the EU CPI on Friday which are likely to bring further volatility in the markets.

 

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