EUROPEAN SHARES
European stocks edged slightly higher on Tuesday, hovering close to a 2-month high with lower volumes than usual, as the “wait and see” stance prevails on most markets. Investors are still awaiting further insight into the health of major world economies, which will be provided by this week’s batch of data, starting today with the US PMI figures.
The cautious start to the week for most benchmarks, compounded by the US bank holiday yesterday, is likely to be short-lived as we expect market volatility to gradually increase from now on. Although some uncertainty lingers ahead of this week’s macro developments and following a mixed summer season for investors, market sentiment remains resilient as the lack of direction has not led benchmarks into corrective territory so far.
The STOXX-50 index continues its slow dance around the 5,000pt level, supported mainly by good performances from the luxury sector, with LVMH, Hermes, Kering, and Ferrari as the top movers this morning. The bearish divergence between the index and the RSI indicator underlines the current lack of conviction in the market, but prices still trade above their mid-term bullish trendline so far.
Pierre Veyret – Technical analyst, ActivTrades
Source: ActivTrader
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