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Economic Calendar:

Tuesday, 22nd September

Eurozone Flash Consumer Confidence

Wednesday, 23rd September

GfK German Consumer Climate (Oct)

Spanish GDP (QoQ) (Q2)

French Manufacturing PMI (Sep) Prelim

French Services PMI (Sep) Prelim

German Manufacturing PMI (Sep) Prelim

German Services PMI (Sep) Prelim

Eurozone Manufacturing PMI (Sep) Prelim

Eurozone Markit Composite PMI (Sep) Prelim

Eurozone Services PMI (Sep) Prelim

Thursday, 24th September

German IFO Business Climate Index (Sep)


The Majors

It was a particularly bearish start to the week for the European majors on Monday. The DAX30 slumped by 4.37% to lead the way down, with the CAC40 and EuroStoxx600 sliding by 3.74% and by 3.24% respectively.

A fresh spike in new COVID-19 cases across EU member states weighed on the European majors on the day.

The sell-off continued on from Friday, following the WHO’s warning of Europe being in a “very serious situation”.

There were no major stats to distract the markets, with the fear of a reintroduction of lockdown measures doing the damage.

Following recent central bank commentary and economic indicators, the economic recovery had already begun to wane. A reintroduction of lockdown measures could hit the European economy far harder than the 1st time around.

The Stats

It was a quiet day on the Eurozone economic calendar. There were no material stats to provide the European majors with direction at the start of the week.

From the U.S

It was also a quiet day, with no material stats from the U.S session to provide the majors with direction.

The Market Movers

For the DAX: It was a bearish day for the auto sector on Monday. Continental and Volkswagen slid by 5.21% and by 5.13% respectively to lead the way down. BMW and Daimler weren’t far behind, with losses of 4.41% and 3.91% respectively.

It was also a particularly bearish day for the banks. Deutsche Bank tumbled by 7.64%, with Commerzbank sliding by 5.42%.

From the CAC, it was much better for the banks. BNP Paribas and Credit Agricole ended the day down by 6.37% and by 5.36% respectively. Soc Gen led the way down, however, tumbling by 7.66%.

It was also a particularly bearish day for the French auto sector. Peugeot and Renault ended the day with losses of 4.91% and 7.75% respectively.

Air France-KLM slumped by 7.63%, with Airbus SE sliding by 6.57%.

On the VIX Index

It was back into the green for the VIX on Monday. Reversing a 2.38% loss from Friday, the VIX rose by 7.55% to end the day at 27.78.

The U.S majors hit reverse as investors responded to the spike in new COVID-19 cases that could derail the sputtering economic recovery.

The Dow and S&P500 fell by 1.84% and by 1.16% respectively, while the NASDAQ saw a more modest loss of 0.13%.

The Day Ahead

It’s a quiet day ahead on the Eurozone economic calendar. Key stats include the Eurozone’s flash consumer confidence figures due out late in the day.

With little else to focus on through the day, we can expect sensitivity to the numbers. Consumer confidence and spending remain key to any sustainable economic recovery. Expect any disappointing numbers to peg the majors back.

From the U.S, FED Chair Powell is back in the spotlight, however. We would expect Powell’s testimony to have the final say on the day.

Away from the economic calendar, geopolitics and COVID-19 news updates will also need tracking.

The Futures

In the futures markets, at the time of writing, the Dow was up by 34 points, the DAX up by 148.5 points.

For a look at all of today’s economic events, check out our economic calendar.

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