Shares slid slightly lower for the beginning of the week in Europe despite a positive but calm trading session in Asia overnight. This week begins on a much less volatile tone than what we saw on equity markets last Friday, thanks to thinner volumes due to Martin Luther King Day in the US. In addition to the lack of US investors on the markets, today’s calmer tone is also explained by EU traders digesting the initial trade deal signing as well as the recent set of reassuring data from both US and China. Volatility has surged on oil markets overnight after a pipeline has been shut down by an armed group in Libya and Iraq halted output amid escalating tensions with the US. These geopolitical tensions sparked an immediate reaction on oil-related shares like airlines (British Airways, Air France, Lufthansa etc) and energy (Shell).
Photo by Raphael Maksian.
Apart from this bearish leverage, traders are now focusing on the next batch of earnings reports with Netflix, UBS, Hyundai, IBM and Procter & Gamble this week. Investors will also be looking forward to hear from Christine Lagarde this week as the ECB will decide on rates and set out its plan for the next monetary moves.
Meanwhile, the Stoxx-600 keeps on being weighed down by utilities and media shares with the FTSE-MIB the worst performer. The market is currently trading below 24,000pts after a solid bearish drop right after the opening bell with the next significant level located at 23,900pts.
