European shares fall and commodity prices fall after Wall Street rally

European stocks opened lower, after their best day since March 2020, as investors waited to see if the European Central Bank would maintain its loose monetary policy to protect its economy. block from the war in Ukraine or not.

Stoxx 600 stock index in the region, rallied 4.7% on Wednesday on a strong basis rally that ended four days of losses, losing 0.5% in early trades on Thursday. The moves come ahead of the ECB’s monetary policy statement in the afternoon, as well as an EU summit where leaders will debate a unified response to the recession risks from the blow. energy price shock due to sanctions against Russia.

London’s FTSE 100 is down 0.6%. Germany’s Xetra Dax, up nearly 8% on Wednesday, fell 0.8%.

The moves come after rallies on Wall Street overnight and in Asia, as investors pinned hopes on Opec and US shale operators to increase supply to soften energy prices. quantity is increasing. The United Arab Emirates is set to encourage other members of the production team to raise output, while US Secretary of Energy Jennifer Granholm on Wednesday urge domestic oil and gas corporations to increase production, saying the country is in a state of “war”.

“Markets seem to have grasped some of the slightly gloomier clues as an excuse to rally sharply over the past 24 hours,” said Robert Carnell, head of research for Asia at ING. “.

Some analysts, however, questioned whether Wednesday’s gains would hold, amid another night of shelling and missile attacks by Russian forces in Ukraine.

“By far the most common question we have received from investors over the last 24 hours is whether yesterday’s market rally has been successful,” said Karl Steiner, chief quantitative strategist at SEB. must be the first step in a more lasting change.”

He added: “We are less certain that the bottom has been reached. “The fact that the war will be resolved through negotiations in just a few weeks seems unrealistic.”

Meanwhile, ECB governing board members may emerge divided over whether to delay plans to withdraw emergency monetary policy measures implemented during the coronavirus crisis two years ago. . Although the Ukraine war is a threat to economic growth, eurozone inflation hit a record high last month.

“We expect the ECB to confirm its intention to normalize policy later this year, although the timing and pace of monetary tightening may have to be decided,” said Frederik Ducrozet, strategist at Pictet Wealth Management. reevaluate in the future”.

Brent crude, the international oil benchmark, rose 3.9% to $115.55 a barrel after falling 13% in the previous session. The European wholesale gas contract tracks TTF futures, steady at around €148 per megawatt hour after surging as high as €335 on Monday.

In Asia, Japan’s Topix is ​​up 4% on its best day since June 2020, while Australia’s S&P/ASX 200 is up more than 1%. China’s benchmark CSI 300 index rose 1.6% while in Hong Kong, the Hang Seng index gained 1.2%.

The gain followed a rally on Wall Street, where the benchmark S&P 500 index gained 2.6% and the tech-focused Nasdaq Composite gained 3.6%.

Unhedged – Markets, Finance and Strong Perspectives

Robert Armstrong analyzes the most important market trends and discusses how Wall Street’s best minds respond to them. Registration this to get newsletters delivered straight to your inbox every day of the week

Source link


News7h: Update the world's latest breaking news online of the day, breaking news, politics, society today, international mainstream news .Updated news 24/7: Entertainment, the World everyday world. Hot news, images, video clips that are updated quickly and reliably

Related Articles

Back to top button