Thursday , January 21 2021

Fear of new sales in February in Europe – markets in a minute

European stock markets are at their lowest level in May

European stock markets are depreciating for the third consecutive session, punished by the increase in the spread of covid-19 in the region and the restrictive measures imposed in several countries, which further obscure expectations for economic recovery.

Investors are worried that the tightening of restrictions will exacerbate the impact of the pandemic on economic activity and that a repeat of black February, marked by general closure in various countries, has paralyzed business and led to a sharp drop in stock markets.

Europe benchmark Stoxx600 is down 1.97% at 345.61 points, the lowest since May, after the German chancellor proposed closing bars and restaurants on November 4. In France, President Macron is also considering imposing a one-month prison sentence.

In this scenario, the most risky assets, such as stocks, are severely penalized, while safe haven assets such as the US dollar, yen and debt continue to rise.

S&P 500 futures fell 1.5%, and the VIX index, a measure of volatility in US stocks, rose to its highest level since June.

“We have been warning investors in recent days, especially to reduce their risk positions a little bit,” Laura Fitsimons, executive director of macro sales at JPMorgan Australia, told Bloomberg TV. “Biden’s chances are starting to diminish a bit and maybe it will continue even more. We all remember what it was like four years ago, when the markets were very surprised.”

Uncertainty over the US election also contributes to market turmoil, as well as to almost zero hope for new measures to stimulate the economy before November 3.

Here, the PSI-20 drops 0.93% to 3,941.37 points, penalized mainly by GP and Gallup.

Source link