Europe to open with moderate growth, activity expected on ČEZ in Prague
European indices interrupted a series of declines yesterday and slightly strengthened after 6 days. Currently, it looks like there will be a slight growth at Wednesday’s opening (futures +0.4%). Wall Street ultimately saw decent growth yesterday, with the SP500 index adding +1.2% and the Nasdaq 100 technology index even adding +1.7%. Strong economic data and the approaching end of the half-year are not conducive to a major decline. Today, investors will be watching the meeting of central bankers in Portugal, with speeches by J. Powell and C. Lagarde, among others. However, it can be expected that they will reiterate their commitment to fighting inflation through tightening rates. Japan performed well overnight in Asia (+1.9%), while China stagnated as the Biden administration considers restricting chip exports for artificial intelligence. The Prague Stock Exchange did not find a path to growth on Tuesday, with the PX index closing at -0.9% at 1290 points. The ČEZ shares may have been responsible for this, as they fell by -2.3% to 1021 CZK. The stock initially reacted positively to the approved dividend of 145 CZK (today is the last day on the stock exchange with entitlement), but gradually the price returned to 1030 CZK after the arrival of foreign sellers. Later in the afternoon, the price even broke through this technical level and stopped its decline at 1021 CZK. We expect volatility today as investors focus on where the shares will trade without entitlement to dividends in the coming days. At the moment, it looks like a decline below the technical level of the 200-day average (940 CZK). Erste in Prague closed at 724 CZK (-0.14%) on Tuesday, but the banking sector in the surrounding area was strengthening, so this sentiment could slightly lift Erste shares.
Pavel Hadroušek, broker, Fio banka, a.s.
What factors could potentially lift Erste shares in Prague, considering the strengthening surrounding banking sector
Europe Poised for Moderate Growth, Activity Expected on ČEZ in Prague
After a streak of declines, European indices showed signs of recovery yesterday, bolstering hopes for a slight growth at Wednesday’s opening. Futures indicate a positive start, with a projected increase of 0.4%. Wall Street already experienced significant growth, with the SP500 and Nasdaq 100 technology indices surging by 1.2% and 1.7%, respectively. The strong economic data and the approaching end of the half-year are unlikely to result in a major decline.
Investors will closely monitor the central bankers’ meeting in Portugal today, featuring speeches from prominent figures such as J. Powell and C. Lagarde. It is anticipated that they will reiterate their commitment to combating inflation by tightening rates. In Asia, Japan fared well, recording a 1.9% increase overnight. Conversely, China faced stagnation due to contemplation within the Biden administration of restricting chip exports for artificial intelligence purposes.
On Tuesday, the Prague Stock Exchange struggled to find growth, as the PX index closed at 1290 points, down 0.9%. ČEZ shares may have contributed to this downturn, experiencing a 2.3% drop to 1021 CZK. Initially, the stock responded positively to the approved dividend of 145 CZK, but foreign sellers’ arrival caused the price to steadily decline to 1030 CZK. Eventually, it broke through the technical level, finally halting at 1021 CZK. Today, investors should expect volatility and closely observe how the shares perform without the entitlement to dividends in the coming days. Currently, it appears that a decline below the technical level of the 200-day average (940 CZK) looms.
Erste in Prague concluded Tuesday at 724 CZK (-0.14%). However, with the banking sector in the surrounding region strengthening, there is a possibility that sentiment could lift Erste shares.
Interesting article! It’s great to see the European indices experiencing mild growth, and I’m curious to learn about the expected activity at ČEZ in Prague. Exciting times ahead for the energy sector!