European Equities: Futures Point Northwards Fueled by Trade Optimism

The Majors

While the German markets were closed on Christmas Eve, the CAC40 and EuroStoxx600 saw limited movement on the day. The CAC40 ended the day up by just 0.18 points, while the EuroStoxx600 rose by 0.14%.

With volumes on the lighter side, support came from progress towards phase 1 of the U.S – China trade agreement.

The U.S majors had hit record highs ahead of the holidays, providing support on Tuesday, with more gains coming on Thursday.

The Stats

It was a quiet day on the Eurozone economic calendar on Tuesday. There were no material stats from the Eurozone to provide the European majors with direction.

There were also no stats from the U.S to provide direction, with the European and U.S markets on a shortened trading session ahead of Wednesday’s holiday.

The Market Movers

From the CAC, it was a mixed day for the banks. BNP Paribas and Soc Gen fell by 0.24% and by 0.05% respectively, while Credit Agricole rose by 0.04%.

It was a bearish day for the French auto sector, with Peugeot and Renault falling by 0.73% and by 0.01% respectively.

On the VIX Index

The VIX fell by 0.16% on Thursday. Partially reversing 0.48% rise from Tuesday, the VIX ended the day at $12.7.

Positive sentiment towards the U.S – China trade war pinned back the VIX, as the U.S majors continued to rise northwards.

Losses on the day were minor, however, as some concern over current levels in the U.S equity markets raised doubts over whether the momentum can continue.

The Day Ahead

It’s another particularly quiet day on the Eurozone economic calendar. There are no material stats due out of the Eurozone to provide the European majors with direction.

From the ECB, the Economic Bulletin will garner some interest later this morning, though it may ultimately be a catch-up session. U.S stocks and crude oil prices were on the move, supported by trade optimism, on Thursday.

On the geopolitical front, any further updates from Beijing or Washington will also influence. From the early part of the week, news of China removing tariffs on $850m worth of U.S imports was positive.

There were also reports of China ramping up soybean imports to levels not seen in 2-years.

In the futures markets, at the time of writing, the DAX30 was up by 53.5 points, with the Dow up by 29 points.