Date: 23 Apr 2020
The euro is losing ground to all other major currencies during early Thursday trading following the publication of concerning data for Germany, the single currency’s largest economy. The Markit composite PMI, which measures manufacturing and services activity, plunged from 35 points to 17.1, shocking markets with a figure that came in way below market expectations. The plunge in economic activity from the powerhouse of Europe illustrates the scale of the recession sparked by the coronavirus fallout; euro traders should fasten their seatbelts.
Ricardo Evangelista – Senior Analyst, ActivTrades
The storm for oil isn’t over but at least for the time being it is less volatile than the headline-grabbing moves of the last few days. It is clear that any additional cut by OPEC would only be a temporary solution and not a definitive one. Moreover, many producers will struggle with further cuts, even if this seems to be the only alternative to ultra-low prices. On a separate note, once we get closer to the next expiry, it is entirely possible for prices to go negative again as long as the tanks remain full leaving no home for the oil that needs to be delivered.
Carlo Alberto De Casa – Chief analyst, ActivTrades
European stocks had a mixed opening on Thursday ahead of a busy day of releases, including the latest US unemployment figures as well as a new batch of corporate results. Investors welcomed encouraging data on the virus front, especially New York City reporting its lowest death toll since early April while the number of cases is also trending lower on the old continent. However, investors around the world are still struggling to assess the pandemic’s damage to corporate profitability and this keeps on weighing on traders’ risk appetite, making it unlikely that any new highs will be achieved before the end of the month. Today’s earnings are more focused on Europe with big French and German names like Bouygues, Renault, Vinci and Schneider Electric reporting results. The CAC-40 Index is one of the eurozone’s best performers today as with the price still trading above 4,400pts. However, the technical configuration provides cause for concern as the market recently broke out of its short-term bullish trend line with this change in sentiment also backed up by the RSI indicators. A fall below 4,330pts would pave the way to bearish moves towards 4,190pts, then 4,100pts and 3,990pts by extension.
Pierre Veyret– Technical analyst, ActivTrades
*The information provided does not constitute investment research. The material has not been prepared in accordance with the legal requirements designed to promote the independence of investment research and as such is to be considered to be a marketing communication. All information has been prepared by ActivTrades PLC (“AT”). The information does not contain a record of AT’s prices or an offer of or solicitation for a transaction in any financial instrument. No representation or warranty is given as to the accuracy or completeness of this information. Any material provided does not have regard to the specific investment objective and financial situation of any person who may receive it. Past performance is not a reliable indicator of futures performance. AT provides an execution-only service. Consequently, any person acting on the information provided does so at their own risk.