As of Tuesday`s data, it says that the European market might face a mixed form of performance in their stock prices, and the economic growth is still uncertain.
The European stock market is expected to witness a mixed set of performances after opening on Tuesday. Various stocks are expected to rise, while others may witness a significant fall, which indicates an uncertainty in the market. So, this mixed set of activity from the market is fueled up by the renewed concerns regarding the economic uncertainty and doubts from the European future economic growth, which has become a primary issue once again for the investors.
Let’s breakdown the anticipated data for some of the major European stock indices that are expected to perform well during the initial trading session:
- Here, the United Kingdom`s FTSE index has made a prediction of an increase of 4 points, which might provide a level of 8253.
- The Germany-based DAX is predicted to get a rise of around 23 points, which allowed it to reach 18852.
- CAC 40 of France is also estimated to see a gain of 19 points, which pushes it up by 7518.
- At last, the Italian-based FTSE MIB index has anticipated getting an initial point of 16, which helps it to reach higher at 33610.
So, these data are issued by the IG, which is also a financial institution. Additionally, these slight gains indicate a cautious optimism among the investors regarding these selective markets as in the initial opening phase of the trading session.
It is seen that the European stock market has ended its Monday`s trading session on a positive approach, while the investors were closely monitoring two essential factors, such as the banking deals, which influence the market outlook in a positive manner, and the release of the preliminary composite PMI data for Europe`s major economic countries like France and Germany, as well as the entire Eurozone. So, basically, this data processes the entire business activity among the manufacturing and services sectors. In addition, there is a slowdown in the business activities of these specific regions as the PMI numbers slow down during the month of September. In spite of a significant economic slowdown, the overall European stock market stands higher, which means that investors might become confident due to other factors such as the banking deal.
The investors are closely monitoring the stock performance of Commerzbank on Tuesday after a sharp decline of 5.7 percent during Monday`s session. The decline comes after the criticism given by Olaf Scholz, German Chancellor, where he spoke against UniCredit`s actions, which are based on Commerzbank, and he also labelled them as hostile and unfriendly. Basically, this indicates that UniCredit, which is an Italian bank, might take an aggressive approach, which means it might go for a potential takeover or acquisition attempt, which is not well received by the German leadership, and it might be a reason for the concern among the investors, and it might impact the Commerbank stock prices negatively.
The Italian origin firm UniCredit has raised its ownership acquisition in Commerzbank with a share of around 21 percent and has submitted a further acquisition request of another 29.9 percent. This indicates a potential signal of an acquisition step, which also means that UniCredit is planning to take ownership control in the Commerzbank.
The market of the Asia and Pacific region has witnessed an overnight rise where the Chinese stocks played an important role in it. This significant rise is because of an announcement made during a casual briefing by the Governor of the People’s Bank of China, Mr. Pan Gongsheng. Beijing has introduced a series of policy-easing methods whose primary motive is to stimulate the economy, basically with actions. By the term action, action means to lower the interest rates or provide a necessary financial support to the businesses, so these might increase the investor`s morale in investing in the Chinese markets, which leads to overall regional gains.
The People Bank of China (PBOC) has introduced a plan report regarding a reduction of the reserve requirement ratio on behalf of banks by 50 basis points, but the time frame is yet to be disclosed. In addition, it might help to lower the seven-day reverse repurchase rate to 1.5 percent from 1.7 percent with other monetary policy measures. On the other side, the futures of United States stocks have remained stagnant during Monday`s session, while the S&P 500 and Dow Jones Industrial Average have witnessed a new record high.
The gains might seem to be not that much, but they might extend the last week`s data, as the Federal Reserve of the United States has taken a step to decline the interest rates by half of a percentage point. So, it is estimated that the current Federal Reserve rate might range from 4.75 percent to 5.00 percent.
Link: https://www.cnbc.com/2024/09/24/european-markets-stock-moves-news-data-and-earnings.html
