GOLD
Gold prices continued to rise during early Wednesday trading, approaching the all-time maximum reached in the summer of 2020, when pandemic-induced uncertainty drove investors towards the safety of the precious metal. This time around, the reasons behind investor anxieties can be attributed to fears of an economic slowdown. The banking crisis of March highlighted the negative impact that aggressive monetary tightening by central banks is having on the real economy. Economic data since published showed a slowdown in activity and confidence, with the recent announcement by OPEC plus, of its intention to cut production, likely to feed into inflation and contribute to further deterioration of investor sentiment. Despite the growing traction of these views, that the global economy may be heading for a serious contraction, central banks continue to shrug concerns aside, choosing to focus on fighting persistently high inflation through increasingly higher interest rates. Against this background, there may be scope for further gold price gains.
Ricardo Evangelista – Senior Analyst, ActivTrades
Source: ActivTrader
EUROPEAN SHARES
Shares markets slid lower in Europe on Wednesday, extending the uncertain sentiment seen overnight in Asia, as investors seek safety. Appetite for risk is slowly decreasing, taking a break from the sharp bull run that started last week, while investors wait for further macro developments. The situation is not considered threatening so far, as a pull-back on equities was beginning to be widely expected after such a surge in prices over the past few days and markets are coming back to support zones which previously acted as resistances to the market. Most sectors registered slight losses with basic material and Industrial shares as the top movers so far. The Stoxx-50 still trades above the 4,300pts level, close to its bullish trendline and between both of its moving averages (13 and 21), while the RSI doesn’t show any signs of an anticipated break-out here. Investors will however cautiously monitor the next US ADP employment change alongside the ISM manufacturing data for March due in the afternoon, while a batch of EU PMI figures should increase market volatility in the morning.
Pierre Veyret– Technical analyst, ActivTrades
Source: ActivTrader
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 (“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 future performance. AT provides an execution-only service. Consequently, any person acting on the information provided does so at their own risk.