European markets traded slightly lower on Tuesday, despite yesterday’s record close on the S&P 500 Index and a bullish Asian trading session overnight amid fresh optimism about the US-China “phase one” deal. This little decline on EU stocks can be explained by profit-taking ahead of both US GDP data and the Fed’s decision on rates tomorrow. This should not lead to a very directional corrective move today as there is no change to the fact investors have seen uncertainty ease over the US-China trade dispute and a shift in monetary policy from central banks.
However, sooner or later investors will have to see a direct positive impact on the real economy to take their risk appetite higher and increase their exposure to stocks. The earning season continues with General Motors, L’Oréal, LDLC and Merck reporting their results today while investors are also eyeing data from Facebook, Apple, Airbus, Exxon Mobil, BP, PetroChina and Credit Suisse later this week.
Photo by Maria Soledad.
