European equity markets fluctuated strongly on Wednesday as investors remain cautious following the mixed economic data and the recent volatility in the markets. CAC, DAX and the London benchmark index gave back earlier gains and ended the day fairly flat.
On the macroeconomic front, Markit PMI data from Eurozone, UK and Germany was slightly below analysts’ estimates, while the Eurozone’s retail sales plunged sharply by 1.6% in December, weighing on market sentiment. In the US, the figures were fairly mixed as Markit Services PMI final climbed higher to 56.7 in January, but US employment data was fairly tepid as ADP employment showed an increase of 175,000 positions in January, below estimates of 180,000. The US dollar continues to trade sideways with the USD index trading sideways around the 81.1 area.
In London, gains in healthcare and base metal stocks offset modest losses in retail stocks. GlaxoSmithKline surged by 1.64% following a strong earnings’ forecast about its sales in 2014.
Tomorrow, the release of the UK Halifax house prices will draw investors’ attention, while the main focus will turn to the interest rates decisions from the European Central Bank and the Bank of England. In the afternoon, the release of the weekly jobless claims could provide further signs about the US employment conditions ahead of the key non-farm payroll report on Friday.