What Is Keeping the European Markets Near the Flat Line?
On Monday, European markets were mostly flat; meanwhile, investors awaited more clues from the Federal Reserve on a possible interest rate rise route this week.
Europe’s STOXX 600 index was merely 0.02 percent higher as of 03:20 a.m. EST (0720 GMT). Following parliamentary elections in France, when President Emmanuel Macron lost his majority in the National Assembly; the CAC 40 slipped into the red. Trading has been bumpy throughout the Asian day due to the closure of U.S. markets for the Juneteenth holiday. Markets have been struggling to process a mass of large rate rise announcements from central banks around the world to cool skyrocketing inflation, with fears mounting that these moves might set off a broader economic downturn.
What To Expect from The Market This Week?
On Wednesday and Thursday, Federal Reserve Chair Jerome Powell should provide hawkish testimony to legislators in the United States House of Representatives. Investors around the world are now waiting on the new change in policies. At its most recent meeting, the Fed raised interest rates by 75 basis points, the largest increase since 1994. Governor Christopher Waller of the Federal Reserve indicated over the weekend that he would support another raise of similar magnitude next month. Meanwhile, ECB President Christine Lagarde will speak to the European Parliament in Brussels later today, after the central bank’s announcement last week of intentions to raise interest rates and develop a new tool to prevent a rapid rise in borrowing costs in weaker eurozone nations.
EasyJet (LON: EZJ) announced it would cut further flights this summer; the reason behind this was personnel shortages and capacity limitations at London Gatwick and Amsterdam; hence, its shares fell. Associated British Foods (LON: ABF) shares increased following a surge in revenues at its major Primark subsidiary in the third quarter.
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