Market View

In the pre-opening, the European Indexes were traded with contained variations. European markets continue to reflect the optimism that the US election results have generated. However, this positive sentiment is not transversal to all indices and sectors. The more cyclical sectors continue to be the main beneficiaries (with their export component benefiting further from the weakness of the Euro), while the sectors most sensitive to interest rates continue to be penalized. Central European markets have been the main performers, while South European stock markets have been underperforming, explained by the higher yields of these economies, the exposure of several companies and banks to emerging markets and the approaching of the Italian referendum. Despite all these movements, the European indices continue to be traded in a wide range, which has lasted since June. In addition to the economic indicators, investors will monitor the publication of the minutes of the last meeting of the Fed (7:00 pm). The publication of this document may be less important than usual as investors expect, almost consensually, that the Fed raise interest rates at the December meeting. In fact, money markets put that probability at 100%. Tomorrow is celebrated Thanksgiving, and the market is closed. On Friday, the session will be shorter, ending at 18:00 GMT. Thus, it is expected that in the final phase of today’s session there will be a decrease in volume as several fund managers prematurely leave the trading rooms. The English Treasury Minister will hold the quarterly presentation on the economic situation today at 12:30 p.m. Investor sentiment will fall on the hypothetical measures that Theresa May’s executive has to curb the negative effects of Brexit.

Market View