- Deterioration of sentiment at the end of the week
- Banks and technology the main losers of Friday's session
- Investors await the NFP reading from the US (01:30 pm BST)
General market situation:
Friday's session on European stock markets brings an extension of the downward momentum. Germany's DAX is currently losing 1.1% on an intraday basis. At the same time, the French CAC40 is down 0.35%. Large discounts are seen today in the banking and technology sectors, mainly influenced by Intel's weak results and a possible increase in fiscal pressure in the Italian banking sector. Investors' attention turns today to the NFP data from the US, so we can expect to see a spike in volatility on many instruments in the market at 1:30 pm BST.
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Volatility currently observed in the broad European market. Source: xStation
Germany's benchmark DE40 traded nearly 0.85% lower during Friday's session. The index broke below the key support level set by the 100-day EMA (purple curve on the chart). Breaking through the bottom of this zone and closing the intraday candle below may open the way to deeper declines set by the abolition of the 23.6% Fibo of the downward channel set by the upward impulse initiated in October 2023. Right now the index is testing the above support. If the market bulls fail to take dominance over the market here as well, a further supply reaction could take the index to the region of 17,700 points, where the 200-day exponential moving average (gold curve on the chart) currently runs. The main resistance levels now remain the zones of the previously mentioned 50-day and 100-day exponential moving averages. Source: xStation
News:
Europe's semiconductor sector is seeing sizable declines today, following a prolonged retreat in global technology stocks. Intel's plan to cut capital spending by 20% is weighing on chipmaker stocks, while Microchip's weak outlook is hitting chipmakers. Among chipmaker stocks, ASML -6.3%, ASMI -9.5%, BE Semiconductor -6.8%, VAT Group -8.2% Among chipmakers, Infineon -3.6%, STMicro -3.6%, Melexis -1.7%, Nordic Semiconductor -6.0%.
Source: xStation
European bank stocks extended yesterday's steep declines as concerns about economic growth grow, prompting traders to increase bets on interest rate cuts. Italian banks fared particularly poorly, as local media reported that the government may be considering a possible tax on lenders and insurance companies.
Source: xStation
Analysts at Bankhaus Metzler lowered their recommendation for MTU Aero Engines AG (MTX.DE) shares to "hold" from "buy." The company's reported earnings on August 1 exceeded analysts' estimates.
Other news coming out of individual companies in the DAX index. Source: Bloomberg Financial LP
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