A strong rebound for European equities

Tuesday, March 25, 2014

European equity markets rebounded today, reversing yesterday’s losses as strong economic data improved market sentiment. The CAC, DAX, IBEX and the London equity benchmark index all posted strong gains, climbing between 0.78% and 1.63%.

It seems that the fairly robust trading updates from the Easyjet and Kingfisher increased risk appetite. In addition, there have been renewed rumours about fresh stimulus in China that provided further support to global equity and commodity markets.

In London, Kingfisher topped the equity index after climbing almost 6% after posting robust annual results with profits of £744 million, which beat analysts’ forecasts.  The UK inflation (CPI index) fell to 1.7% in February compared to 1.9% in January, reaching its lowest level since 2009.

We have received some fairly tepid Chinese economic data in the last few trading sessions, which verify the slowdown in the Chinese economy. However, there was fresh news today that China could provide fresh stimulus in order to boost its economy that provided strong support to base metals prices. LME Copper surged above 6600, while LME Aluminium climbed above 1750 in today’s trading session.

Tomorrow, investors will be keeping an eye on the release of the US build permits and durable goods data as well as German GfK consumer sentiment survey. 

LME Copper

LMCADS03 Comdty (LME COPPER    3 2014-03-25 17-37-01

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