European markets had a mixed opening, setting the trend for US futures on the S&P 500, as investors took some profits after yesterday’s strong rally. However, the risk-on mood isn’t dead yet as all European benchmarks edged significantly higher shortly after the opening bell. An extension of the current recovery is now a real possibility as investors digest good corporate earnings as well as reassuring news coming from China about the coronavirus likely peaking on the 21st of February. In addition, China also confirmed one of its universities has found an “effective” drug to treat people with the deadly virus. Investors didn’t need much to change their trading stance and bought the dip on risky assets ahead of today’s Christine Lagarde’s speech at the ECB as well as the highly awaited US job reports due on Friday.
In Europe, gains in construction and tech shares are offsetting declines by oil and household goods. The best performance is coming from both the OMX-30 Index of Stockholm and the DAX-30 in Frankfurt with many investors awaiting Q4 2019 earnings reports from BNP Paribas, Spotify and General Motors today. The DAX-30 Index is challenging its first resistance below 13,375pts, where a break-out could lead prices up to 13, 515pts and 13,600pts by extension while support levels can be found at 13,290pts and 13,240pts.
