- European stock indices recorded slight losses on Friday to close another week lower.
- Davos ended with little guidance on rates from policymakers.
- The rate tantrum is underway as investors shy away from hopes of an excessive rate cut.
European stock indices fell on Friday as investors left the World Economic Forum (WEF) in Davos, Switzerland with few upbeat headlines from the European Central Bank (ECB). This week, ECB policymakers have worked overtime to dispel market expectations of an imminent interest rate cut. With inflation remaining high for longer in the European economy, the ECB cannot lower rates for the time being.
ECB President Christine Lagarde went to great lengths to avoid talking about monetary policy during her scheduled appearances at the Davos economic summit, but noted in an interview with Bloomberg that excessive market expectations of a rate cut by the ECB may be hindering, rather than helping, progress in the fight against inflation.
In the absence of supportive statements at Davos, investors were forced to withdraw their bets on ECB rate cuts, and European stocks retreated on Friday. Most indices posted their worst declines in several months this week, and bullish momentum remains mired in misaligned market expectations.
The German DAX closed practically flat on Friday, with a slight drop of 0.07% and a decline of 12 points to close at 16,555.13 euros. The French CAC 40 fell almost 40 points and closed with a decrease of 0.4%, at 7,371.64 euros. The pan-European STOXX600 closed at 469.24 euros, with a decrease of 0.26% and a loss of 1.21 points.
The FTSE, London's main share index, made little progress on Friday and closed up 0.04% at £7,461.93, up 2.84 points but still at six-week lows near £7,400.00. .
DAX Technical Insights
The German DAX tested a seven-week low this week, capturing a late-week bid to end trading near €16,550.00, still lower on the week but keeping closing bids within reach of the lows. short term.
The DAX is down in 2024, but remains decidedly higher since the last major low in October, with bids close to €14,600.00.
The intraday bullish momentum was slowed by the 200 hourly simple moving average (SMA) near €16,600. Next week's bids will face significant technical resistance from short-term congestion between €16,700.00 and €16,750.00.
DAX hourly chart
DAX Daily Chart
|Latest price today
|Daily change today
|Today's daily variation
|Today's daily opening
|Previous daily high
|Previous daily low
|Previous weekly high
|Previous weekly low
|Previous Monthly High
|Previous monthly low
|Daily Fibonacci 38.2
|Fibonacci 61.8% daily
|Daily Pivot Point S1
|Daily Pivot Point S2
|Daily Pivot Point S3
|Daily Pivot Point R1
|Daily Pivot Point R2
|Daily Pivot Point R3
Source: Fx Street
I am Joshua Winder, a senior-level journalist and editor at World Stock Market. I specialize in covering news related to the stock market and economic trends. With more than 8 years of experience in this field, I have become an expert in financial reporting.