European Stocks Up, Boosted by Yellen Push for U.S. Stimulus Measures
European stocks were up on Monday morning, starting the week with on an optimistic note after the U.S. Secretary of the Treasury Janet Yellen pushed for a U.S. stimulus package to be passed and COVID-19 trends showed improvements.
Yellen said on sunday that the U.S. could return to full employment in 2022 if the country enacts a robust enough relief package.
However, some investors expressed skepticism about Yellen’s statement.
“That’s a big call given full employment is 4.1%, but one that will sit well with the market at a time when the COVID-19 vaccination program is being rolled out efficiently in a number of countries,” Pepperstone chief strategist Chris Weston told Reuters.
Disappointing U.S. jobs data from Friday also continues to dent investor sentiment. The U.S. jobs report for January showed that fewer jobs were created in the economy than expected. Non- farm payrolls were at 49,000 and the unemployment rate was at 6.3%.
Further U.S. data, including the Federal Budget and the consumer price index, will be released later in the week.
Although the data highlighted the economic recovery’s fragility and the need for further stimulus measures, other investors warned that the introduction of these measures could boost inflation and overheat asset prices.
“It does seem to be the case that global markets have now become addicted to stimulus and that the greatest risk to the outlook, and potential trigger for a correction in risk-asset valuations, would be central banks dialing down the music,” First Abu Dhabi Bank Pjsc chief economist Simon Ballard told Bloomberg.
However, investor sentiment was boosted by a continuous global rollout of COVID-19 vaccinations. Sinovac Biotech Ltd received conditional approval from China’s National Medical Products Administration for its Coronovac offering over the weekend.
Also boosting sentiment was data suggesting that COVID-19 daily cases are declining in countries such as the U.S., France and Germany. There were also no new locally transmitted COVID-19 cases for the first time in nearly two months in China, according to data released on Monday.
On the central bank front, Federal Reserve Chairman Jerome Powell will deliver remarks during a webinar on Wednesday.
The pan-European #Stoxx 50 climbed up by 0.37% to 3,655.77. In the cash markets, the #DAX futures Germany was trading 0.03% down at 14,056.72. #CAC40 futures in France climbed up by 0.90% to 5,659.26, while the #FTSE100 futures in the U.K. fell by 0.22% to 6,489.33 ,at the time of writing.
TECHNICAL INDICATORS
#FTSE 100:-
Indicator RSI MA (5) MA(20) MA (50) Bollinger
(U,M,L) Stochastic
Reading 42.013 6496.79 6634.90 6574.77 U=6876.3013
M=6634.9020
L=6393.5027
%k=24.2546
%d=26.5386
Comment Selling zone Price Below the moving average Price Below the moving average Price Below the moving average Price is Below UB
Price is Below MB
Price is Above LB Crossover to the Downside
Trend Bearish Bearish Bearish Bearish Bearish Bearish
Special
Notes The market is expected to move in the Negative Territory. All The Moving Averages are Above the trading price.RSI suggests the market may move in a Bearish Zone.
European stocks were up on Monday morning, starting the week with on an optimistic note after the U.S. Secretary of the Treasury Janet Yellen pushed for a U.S. stimulus package to be passed and COVID-19 trends showed improvements.
Yellen said on sunday that the U.S. could return to full employment in 2022 if the country enacts a robust enough relief package.
However, some investors expressed skepticism about Yellen’s statement.
“That’s a big call given full employment is 4.1%, but one that will sit well with the market at a time when the COVID-19 vaccination program is being rolled out efficiently in a number of countries,” Pepperstone chief strategist Chris Weston told Reuters.
Disappointing U.S. jobs data from Friday also continues to dent investor sentiment. The U.S. jobs report for January showed that fewer jobs were created in the economy than expected. Non- farm payrolls were at 49,000 and the unemployment rate was at 6.3%.
Further U.S. data, including the Federal Budget and the consumer price index, will be released later in the week.
Although the data highlighted the economic recovery’s fragility and the need for further stimulus measures, other investors warned that the introduction of these measures could boost inflation and overheat asset prices.
“It does seem to be the case that global markets have now become addicted to stimulus and that the greatest risk to the outlook, and potential trigger for a correction in risk-asset valuations, would be central banks dialing down the music,” First Abu Dhabi Bank Pjsc chief economist Simon Ballard told Bloomberg.
However, investor sentiment was boosted by a continuous global rollout of COVID-19 vaccinations. Sinovac Biotech Ltd received conditional approval from China’s National Medical Products Administration for its Coronovac offering over the weekend.
Also boosting sentiment was data suggesting that COVID-19 daily cases are declining in countries such as the U.S., France and Germany. There were also no new locally transmitted COVID-19 cases for the first time in nearly two months in China, according to data released on Monday.
On the central bank front, Federal Reserve Chairman Jerome Powell will deliver remarks during a webinar on Wednesday.
The pan-European #Stoxx 50 climbed up by 0.37% to 3,655.77. In the cash markets, the #DAX futures Germany was trading 0.03% down at 14,056.72. #CAC40 futures in France climbed up by 0.90% to 5,659.26, while the #FTSE100 futures in the U.K. fell by 0.22% to 6,489.33 ,at the time of writing.
TECHNICAL INDICATORS
#FTSE 100:-
Indicator RSI MA (5) MA(20) MA (50) Bollinger
(U,M,L) Stochastic
Reading 42.013 6496.79 6634.90 6574.77 U=6876.3013
M=6634.9020
L=6393.5027
%k=24.2546
%d=26.5386
Comment Selling zone Price Below the moving average Price Below the moving average Price Below the moving average Price is Below UB
Price is Below MB
Price is Above LB Crossover to the Downside
Trend Bearish Bearish Bearish Bearish Bearish Bearish
Special
Notes The market is expected to move in the Negative Territory. All The Moving Averages are Above the trading price.RSI suggests the market may move in a Bearish Zone.