Major European indices quickly lost opening momentum and are in search of direction, with investors assessing new macroeconomic data from China and Japan.
In particular, the pan-European Stoxx 600 index is moving with a small increase of 0.13% and is at 441.4 points, with the defense sector of health care supporting the transactions moving to +1.1% while insurances are falling by 0.4% .
In the rest of the European charts, the German DAX after the positive opening has gone into losses, although only 0.08% moving to 13,786 points, as well as the French CAC 40 which is close to unchanged at 6,564 points, while the British FTSE 100 is slightly strengthened with +0.17% to 7,515 units.
The picture is better in the markets of the European region, where in Italy the FTSE MIB strengthens by 0.5% and stands at 22,970 points, while in Spain the IBEX 35 registers small gains of 0.1% with a movement at 8,409 points.
After a flurry of macroeconomic data last week, including US inflation and British economic activity, investors’ eyes today turned to Asia whose two biggest economies gave mixed messages.
In China, the economy showed unexpected slowing trends in July, with industrial activity and retail trade under pressure from the zero-Covid policy.
In this climate after all, the People’s Bank of China (PBOC) unexpectedly proceeded to cut the one-year medium-term lending facility (MLF) rate to some financial institutions by 10 basis points (bps) to 2.75% from 2.85%.
It is noted that in a Reuters survey of 32 analysts last week, all respondents expected the interest rate to remain unchanged.
In Japan, by contrast, the economy grew for the third consecutive quarter, thanks mainly to household consumption.
Specifically, GDP in the world’s third-largest economy expanded significantly by 2.2% year-on-year in the second quarter, up from 0.1% in the January-March period, although slower than markets had expected in 2.5%.
Back in Europe, estimates of an impending recession are rising, now at their highest level since the pandemic hit in November 2020, as the energy crisis threatens to further push up record inflation.
In particular, the probability of GDP contraction for two consecutive quarters – the technical definition of a recession – has now risen to 60% in a Bloomberg survey, up from 45% previously and just 20% before Russia’s invasion of Ukraine .
Source: Capital
I am Sophia william, author of World Stock Market. I have a degree in journalism from the University of Missouri and I have worked as a reporter for several news websites. I have a passion for writing and informing people about the latest news and events happening in the world. I strive to be accurate and unbiased in my reporting, and I hope to provide readers with valuable information that they can use to make informed decisions.
