EUROPEAN SHARES
Stocks opened slightly lower in Europe on Wednesday, paring some of yesterday’s rally, with benchmarks weighed down by the luxury sector. The increased appetite for risk, brought by yesterday’s US data as well as positive developments from the tech sector following Tesla and Texas Instrument’s revenue forecast, has been tempered slightly in Europe as investors have been disappointed by Kering’s earning report, dragging the whole luxury sector on the old continent.
However, benchmark pull-backs remain limited as most traders are optimistic regarding the next slew of corporate results, especially with reports from Meta Platforms, Microsoft and Alphabet looming today and tomorrow. With a profit jump of around 40% expected from the “magnificent seven”, investors believe the stock rally may not be over despite lingering geopolitical and monetary uncertainties.
On the macro front, traders will also look to today’s US Crude Oil Inventory to see where the trend could go for black gold, a market closely watched since the beginning of the conflict in the Middle East and the rising prospect of more sanctions on Iran.
The STOXX-50 index is back above the 5,000pts level, just below the 5,042pts resistance, following a bullish break-out of its short-term bearish trendline yesterday. Even if a technical pull-back could still happen, clearing the 5,042pts resistance should open the doors to an extended rally back to the market’s last top above 5,100pts.
Pierre Veyret – Technical analyst, ActivTrades
Source: ActivTrader
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