As it was expected, European stocks opened higher and still increasing. German DAX trading 0.3% higher, CAC 40 in France climbed 0.8%, and the FTSE 100 in the UK rose 0.3%. This gain after yesterday’s rally is important, showing that leading European indexes could hold their gains. On Thursday and after the US inflation surprise, DAX had the best performance with a 3.5% gain. Friday’s Asian stock markets also had a remarkable reaction with a 7.7% gain of HK50.
Hang Seng rose 7.7% in the Asian season!
Along with the US inflation decrease, the Chinese new announcement about decreasing the quarantine time for international travelers from two days to five raised hopes of some relaxation in the strict policies of the Chinese government regarding COVID mobility restrictions.
On the data front, today’s focus was the British GDP. According to the published data, the UK economy contracted by 0.6% in September, with a 0.2% contraction in the third quarter. However, a decrease in quarterly economic growth and annual increase, both were better than expectations, but still, it is a recession and expected to last about two years.
As shown in the chart below, DAX-30 has very strong resistance at 15,000, and technically, we cannot confirm its uptrend under this level. From the fundamental point of view also, it is still too early to talk about changing the market sentiment we need more confirmation. Therefore, it is much better to be cautious but look for bulls.