European stock benchmarks rose for a second day on Friday
EUROPEAN SHARES
European stock benchmarks rose for a second day running on Friday, at the end of a stormy week, as investors bought the dip brought by short-term turbulence in the markets.
Risk appetite is on the rise after investors seized the opportunity brought by fears of a systemic risk sparked by SVB towards the Financial sector, to buy shares at discounted prices.
The panic seen recently has been replaced by a wind of relief as central banks including the Federal Reserve and the SNB, as well as other private financial institutions such as JP Morgan and Citigroup have shown support towards the financial sector to prevent further failure and bring back confidence to the markets.
Investors also noted the latest speech from ECB President, Christine Lagarde, after she announced a 50 bp rate hike yesterday while reaffirming European banks remained resilient and that monetary tightening wouldn’t be a threat to the Eurozone economy as a whole, although she did warn about the possibility of a stagflation inside the Eurozone.
Technically speaking, most equity benchmarks have registered sharp rebounds over key support levels (last top overlap + 23.6% correction of January rally).
On the short-term basis, the STOXX-50 has broken-out of its bearish trendline started in March, opening the door for further highs towards 4170.0pts, 4,205.0pts and 4,260.0pts, while today’s new inflation print will certainly increase market volatility.
Pierre Veyret– Technical analyst, ActivTrades
European stock benchmarks rose for a second day running on Friday, at the end of a stormy week, as investors bought the dip brought by short-term turbulence in the markets.
Risk appetite is on the rise after investors seized the opportunity brought by fears of a systemic risk sparked by SVB towards the Financial sector, to buy shares at discounted prices.
The panic seen recently has been replaced by a wind of relief as central banks including the Federal Reserve and the SNB, as well as other private financial institutions such as JP Morgan and Citigroup have shown support towards the financial sector to prevent further failure and bring back confidence to the markets.
Investors also noted the latest speech from ECB President, Christine Lagarde, after she announced a 50 bp rate hike yesterday while reaffirming European banks remained resilient and that monetary tightening wouldn’t be a threat to the Eurozone economy as a whole, although she did warn about the possibility of a stagflation inside the Eurozone.
Technically speaking, most equity benchmarks have registered sharp rebounds over key support levels (last top overlap + 23.6% correction of January rally).
On the short-term basis, the STOXX-50 has broken-out of its bearish trendline started in March, opening the door for further highs towards 4170.0pts, 4,205.0pts and 4,260.0pts, while today’s new inflation print will certainly increase market volatility.
Pierre Veyret– Technical analyst, ActivTrades
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