Positive market sentiments sink as possibilities of a US-China trade deal diminish
European stocks and U.S. futures are drifting lower today, following a negative Asian session. The positive signal sent yesterday evening by Wall Street after the USMCA trade deal has now vanished after the White House Economic Advisor Larry Kudlow reinforced commercial concerns by saying that a trade deal between U.S. and China was not ‘imminent’. This has spread a wave of uncertainty across most financial markets around the globe.
In Europe, these concerns are to be added to the Italian budget. For now, the crisis has not spread to other European countries but the EU is closely watching. The European Commission remains sceptical towards this preliminary Italian budget, which is not in line with the requirements of the Stability and Growth Pact. Technically, the DAX 30 is 0.60% down at 12260.0pts, trading slightly above its immediate support at 12248.0pts. France’s CAC 40 failed to stay above the strong 5508.0pts support zone and is now heading back to 5455.0pts. If this level gets broken-out, the next target will be 5420.0pts.
By Pierre Veyret, Technical Analyst, ActivTrades
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