European markets are seen opening on a mildly positive note on Friday even as investors come to terms with the ECB’s commitment to retain rates sufficiently restrictive for as long as required. The stronger-than-expected GDP readings from the U.S. is also seen shaping market sentiment. Markets also keenly wait for the PCE-based inflation readings for December from the U.S.
Wall Street had closed on a positive note on Thursday amidst a fresh set of earning reports and updates on GDP, durable goods orders and jobless claims. Nasdaq Composite added 0.18 percent to close at 15,510.50 whereas the Dow Jones Industrial Average rallied 0.64 percent to finish trading at 38,049.13.
Mildly positive sentiment prevailed in the European bourses on Thursday as investors digested the ECB’s hawkish stance and the stronger-than-expected U.S. GDP. The pan-European Stoxx-50 rallied 0.37 percent. France’s CAC 40 and Switzerland’s SMI, both added 0.9 percent. Germany’s DAX gained 0.10 percent. U.K.’s FTSE 100 edged up 0.03 percent.
Current indications from the European stock futures indicate a mostly positive sentiment. The SMI Futures (Mar) has surged 0.81 percent. The CAC 40 Futures (Feb) has rallied 0.57 percent. The FTSE 100 Futures (Mar) has gained 0.41 percent. The pan-European Stoxx 50 Futures (Mar) has edged up 0.07 percent. The DAX Futures (Mar) is however trading 0.15 percent lower.
Ahead of the PCE data update, American stock futures are trading in negative territory. The US 30 (DJIA) is trading 0.26 percent lower, whereas the US500 (S&P 500) is trading 0.30 percent lower.
Asian stock markets are trading on a mixed note as the euphoria surrounding the recent Chinese stimulus waned. Fears of a monetary policy pivot by the Bank of Japan also weighed. South Korea’s KOSPI rallied 0.72 percent whereas China’s Shanghai Composite rallied 0.38 percent. Japan’s Nikkei 225 has slipped 1.1 percent whereas Hong Kong’s Hang Seng has declined 0.52 percent. DJ New Zealand edged down 0.08 percent.
The Dollar Index (DXY), a measure of the U.S. dollar’s strength relative to six currencies, edged down 0.04 percent to 103.54, from the previous close of 103.57. The EUR/USD pair has edged down 0.05 percent to 1.0841 whereas the GBP/USD pair has edged down 0.02 percent to trade at 1.2706.
Gold traded firmly above the flatline, despite the stronger-than-expected U.S. GDP data and hawkish tone in the ECB’s monetary policy review. Gold Futures for February settlement is trading at $2,021.30, which is 0.17 percent higher than the previous close of $2,017.80.
Crude oil prices slipped as markets priced in the likelihood of easing of tensions in the Red Sea. Brent Crude Futures for March settlement slipped 0.29 percent to $82.19 whereas WTI Crude Futures for March settlement dropped 0.50 percent to $76.97.
Gfk Consumer Confidence reading for February from Germany is seen at -24.5, versus -25.1 earlier. The Consumer Confidence reading for January from France is seen edging up to 90 from 89 in the previous month.
Major earnings updates due from the region on Friday include Volvo, Telia Company, SCA, Colgate-Palmolive, HEXPOL, Lonza Group, Billerud, KONE, 3I Group and Sartorius Stedim.
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European Markets Digest The Hawkish ECB Guidance
2024-01-26 06:09:20
