Articles tagged with "germany-40"

Following a weak handover from Asia, European markets and US indices were under pressure this morning, as rising oil prices and elevated bond yields once again weighed on risk appetite. Among the major European indices, the German DAX will be in firm focus this week, with the ECB’s rate decision coming up on Thursday. That decision is likely to be a hike, as rising oil prices threaten to re-accelerate inflation.

The German DAX record high is back in reach after four straight higher sessions, helped by cheaper energy and resilient eurozone data.

But the question, of course, is how much further oil prices and bond yields can fall. For now, the combination is supportive of risk assets and is helping to sustain a relatively benign decline in the dollar. The focus today will be on US core PCE inflation, due for release shortly, while Nvidia’s second-quarter earnings will provide another test for risk appetite after the US markets close – not just for US indices but for global tech-heavy indices given the influence Nvidia has over the global tech and AI names.

European equities are selling off because crude oil, natural gas and government bond yields are all signaling a prolonged energy supply disruption.

If oil prices continue to rise, this could weigh on European markets which have been quite resilient of late. That could weigh on the German DAX forecast given the nation’s reliance on energy imports.

Crude oil and bond yields are both climbing while the Strait of Hormuz stays shut, yet global equity markets have barely reacted.

Volatility across financial markets continues to subside, with investors appearing surprisingly comfortable with rising oil prices and the prospect of the Fed either holding rates steady or tightening policy in September.

After a long and eventful first half of the year dominated by the US-Israel war on Iran and Trump’s constant flip-flopping, the last thing investors, and frankly anyone else, needed with the summer holidays approaching was a return of the same geopolitical environment. Unfortunately, it looks like we could be heading back to that. Crude oil has spiked over the last couple of sessions having just returned to pre-war levels just a few days ago, while European indices such as the DAX and Ibex were nursing losses of 2-3% at the time of writing.

It has been another positive day for European equity markets. The major indices continue to trade with a constructive tone, with several benchmarks either testing record highs or moving within striking distance of them. A combination of easing energy costs, not-so-bad economic data and expectations that central banks may be nearing the end of their short-lived, energy-driven, tightening bias has provided a supportive backdrop for risk assets.

Markets are taking Trump’s latest declaration with a degree of caution. His claim that “we ended the war with Iran” triggered an immediate risk-on reaction, pushing oil prices sharply lower and lifting equities.

European equities pushed higher this morning, joining the global rally. Investors are balancing ongoing geopolitical uncertainty in the Middle East against the relentless strength of the global technology sector. While European benchmarks have lagged behind Wall Street’s technology-led advance for much of the year, it appears like other areas of the market are catching up a little as risk appetite returns.

The recent pullback in oil prices from their extreme levels and strong US technology earnings have helped to support the case for higher equity markets, especially on Wall Street. In Europe, sentiment has been a little more measured. Here, cautious optimism has lifted stocks in recent weeks, but the trend hasn’t been as clean as on Wall Street. Markets could still be heading to new highs assuming there are no major escalations in the Strait of Hormuz. That’s a big assumption.