Europe will attempt to consolidate after Friday’s decline
European stocks are expected to open with little change and a slight upward trend following Friday’s decline (e.g. DAX -1.5%), according to futures indications. Overseas futures are currently up 0.3% (Wall Street weakened by 0.5% on Friday). Investors are closely monitoring the situation in the Middle East, currently evaluating it as an attempt to prevent further escalation. Despite Friday’s increase, oil prices are holding onto gains, trading around $87.4 USD (WTI), while the US dollar and bonds are weakening. Asian indices turned negative overnight, with Japan struggling (-1.5%) and Chinese stocks also declining (down 1%) despite a large liquidity injection from the central bank. The US has further tightened rules on the export of advanced chip technology. After the start of earnings season on Friday (American banks), other companies including technology firms (e.g. TSLA) will continue to report. There will be speeches from several members of the Federal Reserve and the European Central Bank. Prague Stock Exchange weakened towards the end of last week, with the PX index closing at 1346 points on Friday (-0.25%). Shares of ČEZ reached the threshold of 1000 CZK (+0.8%), where they were last traded before the dividend. On the other hand, Erste Bank slightly weakened by 0.9% to 800 CZK. Shares of KB Bank returned to 670 CZK (-0.7%). Today, we expect a slower start with a slight upward trend for banks.
Pavel Hadroušek, broker, Fio banka, a.s.
What factors are influencing the oil prices and how are they holding up despite Friday’s increase
Europe braces for consolidation as markets recover from Friday’s decline. European stocks are poised to open with little change, showing a slight upward trend following a drop in the DAX by 1.5%. However, futures indications point towards a positive start, with overseas futures up by 0.3%. Wall Street weakened by 0.5% on Friday, but investors remain hopeful, closely monitoring the situation in the Middle East as they perceive it as an attempt to prevent further escalation.
In terms of oil prices, despite Friday’s increase, they are holding onto gains and are currently trading around $87.4 USD per barrel (WTI). Meanwhile, the US dollar and bonds continue to weaken. The Asian market experienced a negative turn overnight, with Japan struggling with a 1.5% decline and Chinese stocks also showing a 1% drop, even with a significant liquidity injection from the central bank.
Adding to the mix, the US has tightened rules further on the export of advanced chip technology. As the earnings season kicks off, American banks have already begun reporting, and other companies, including technology firms like Tesla (TSLA), will continue to release their reports. Additionally, speeches from various members of the Federal Reserve and the European Central Bank are expected.
Turning our attention to the Prague Stock Exchange, it ended the week with a weakened performance, as the PX index closed at 1346 points on Friday, representing a 0.25% decrease. However, there were some bright spots, such as shares of ČEZ reaching the threshold of 1000 CZK with a 0.8% increase, the level they were last traded at before the dividend. On the other hand, Erste Bank slightly weakened by 0.9% to 800 CZK, while shares of KB Bank returned to 670 CZK with a 0.7% decline.
Overall, today’s trading is expected to start slower, but with a slight upward trend for banks. Pavel Hadroušek, a broker at Fio banka, a.s., shares his insights on the matter.
Let’s hope for a steady recovery in the European market after Friday’s slump. Stay optimistic!