FX Empire

European Equities: Futures Point to a Positive Open. Another Rally Would be Gravity Defying…

Bob Mason
4 min read

In This Article:

Economic Calendar:

Thursday, 26th March

GfK German Consumer Climate (Apr)

ECB Economic Bulletin

The Majors

It was a second consecutive day in the green for the European majors, with the CAC40 rallying by 4.47% to lead the way. The EuroStoxx600 and DAX30 saw more modest gains of 3.09% and 1.79% respectively.

Wednesday delivered yet another choppy session, with the majors seeing red before finding late support.

The upside came in spite of the continued spread of the coronavirus and the ever-increasing number of countries going into full lockdown.

Hopes of a smooth passing of the U.S Stimulus Bill provided support, following news that the U.S administration had struck a deal.

The Stats

It was a quieter day on the Eurozone economic calendar on Wednesday. German IFO index numbers for March were in focus along with French jobseeker numbers.

In March, Germany’s IFO Business Climate Index tumbled from 96.0 to 86.1. Economists had forecast fall to 87.7.

According to the IFO’s March report,

  • The Business Expectations sub-index fell from 93.1 to 79.7, with the Current Assessment sub-index falling from 99.0 to 93.0.

    • In manufacturing, the index fell to its lowest level since Aug-09, weighed by the largest slide in the manufacturing expectations sub-index in the survey’s 70-year history.

    • Looking at the current situation sub-index, the decline was less pronounced, though still declined across all industries.

    • In the service sector, the business climate index saw its largest slide in survey history.

    • This was also the case for the assessment of the current situation and expectations sub-indexes.

    • In trade, the business climate indicator slumped. Expectations slid to the lowest level since German reunification. Companies also cut their assessment of the current situation.

    • Only food retailers and drugstores were positive exceptions.

From the U.S

February durable goods orders had a muted impact, with the spread of the coronavirus and both fiscal and monetary policy support coming a month later…

The Market Movers

For the DAX: It was a mixed day for the auto sector. Daimler rallied by 3.51%, off the back of Tuesday’s 23.82% surge, to lead the way. BMW and Volkswagen also found further support, rising by 2.88% and 2.25% respectively. Continental bucked the trend on the day, falling by 0.06%.

It was another bullish day for the banks, however, with Commerzbank and Deutsche Bank rising by 5.43% and by 3.22% respectively.

Deutsche Lufthansa fell by 1.48% on the day, partially reversing an 11.44% rally from Tuesday.

From the CAC, it was also a bullish day for the banks. Soc Gen led the way once more with an 11.44% gain, with BNP Paribas and Credit Agricole rising by 5.47% and 7.99% respectively.

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