FXEMPIRE
All
Ad
Corona Virus
Stay Safe, FollowGuidance
World
59,470,595Confirmed
1,401,384Deaths
41,113,400Recovered
Fetching Location Data…
Advertisement
Advertisement
Bob Mason
Growing Euro notes arrows over the flag of European Union.

The Majors

It was another bullish week for the European majors in the week ending 13th November.

The CAC40 rallied by 8.45% to lead the way, with the DAX30 and EuroStoxx 600 gaining 4.78% and 5.31% respectively.

Advertisement

Impressive COVID-19 vaccine updates drove demand for riskier assets in the 1st half of the week. Pfizer Inc. announced a more than 90% efficacy rate, which spurred a global equity market rally.

Also supporting riskier assets was a trade-friendly outcome to the Presidential Election.

The upside came in spite of market concerns over the near-term economic outlook.

A continued rise in new COVID-19 cases and containment measures pegged the majors back in the 2nd half of the week.

Also pressuring the majors late in the week was a reality check on how quickly an effective vaccine can inoculate the region and beyond.

Advertisement

The Stats

In the 1st half of the week, ZEW Economic Sentiment figures for Germany and the Eurozone disappointed.

In November, Germany’s ZEW Economic Sentiment Indicator slid from 56.1 to 39.0. The Eurozone’s indicator fell from 52.3 to 32.8. The deterioration was a reflection of investor sentiment towards the latest lockdown measures.

On Thursday, the ECB’s Economic Bulletin raised more red flags over the economic outlook. The doom and gloom bulletin ended a run of 3 consecutive days in the green for the European majors.

On Friday, 3rd quarter GDP numbers for the Eurozone also failed to impress, with downward revisions pinning back the majors. Quarter-on-quarter, the economy grew by 12.6%, coming up short of the 1st estimate of 12.7%.

Finalized inflation figures from Germany, France, and Spain, and Eurozone industrial production and trade data had a muted impact in the week.

On the monetary policy front, ECB President Lagarde assured the markets of more support next month. The comments off the back of the upbeat vaccine trial numbers from Pfizer Inc. and BioNTech SE.

From the U.S

In the 1st half of the week, JOLTs job openings for September had a muted impact on the markets. The majors brushed aside disappointing numbers, as investors responded to the positive vaccine news.

On Thursday, inflation and jobless claims figures contributed to a Thursday pullback.

Inflationary pressures eased at the turn of the quarter, with the annual core rate of inflation softening from 1.7% to 1.6%.

Jobless claims figures came in better than forecasted but were not good enough to ease concerns over labor market conditions.

In the week ending 6th November, initial jobless claims came in at 709k, down from the previous week’s 757k.

At the end of the week, prelim November consumer sentiment and October wholesale inflation figures were also in focus.

The Michigan Consumer Sentiment Indicator fell from 81.8 to 77.0. Concerns over the 2nd wave of the COVID-19 pandemic and economic uncertainty weighed.

Wholesale inflation figures also disappointed, with the core Producer Price Index rising by just 0.10% in October. In September, the core producer price index had risen by 0.4%.

The U.S majors found strong support at the end of the week, in spite of the weak numbers, however.

The Market Movers

From the DAX, it was another particularly bullish week for the auto sector. Continental jumped by 14.38% to lead the way. BMW and Volkswagen were closed behind, rallying by 11.02% and by 12.35% respectively. Daimler saw a more modest 8.69% gain for the week.

It was also a bullish week for the banking sector. Commerzbank surged by 23.62%, with Deutsche Bank ending the week up by 5.61%.

From the CAC, it was a particularly bullish week for the banks. BNP Paribas surged by 20.13%, with Credit Agricole and Soc Gen rallying by 16.15% and by 19.50% respectively.

The French auto sector also found further support. Peugeot rallied by 11.11%, with Renault ending the week up by 27.79%.

Air France-KLM followed last week’s 9.43% gain with a 26.67% rise, with Airbus rallying by 22.23%.

On the VIX Index

It was a 2nd consecutive week in the red and a 3rd weekly drop from 7 for the VIX. In the week ending 13th November, the VIX fell by 7.08%. Following on from a 34.61% slide from the previous week, the VIX ended the week at 23.10.

Positive data from Pfizer Inc. and BioNTech SE on their COVID-19 vaccine trials delivered the upside in the week. The gains came in spite of continued rising new COVID-19 cases in Europe and the U.S.

Going into the week Biden became the President-Elect, which was also market positive. At the end of the week, Trump’s chances of overturning the result diminished, with Biden taking Arizona, another positive outcome for the markets.

For the week, the NASDAQ fell by 0.55%, while the Dow and S&P500 saw gains of 4.08% and 2.16% respectively.

The Week Ahead

It’s a relatively quiet week ahead on the Eurozone economic calendar.

Finalized inflation figures for Italy and the Eurozone are due out in the 1st half of the week. Barring a material revision from prelims, however, the stats are unlikely to move the dial.

At the end of the week, wholesale inflation figures from Germany and consumer confidence figures for the Eurozone will influence.

With the 2nd wave of the COVID-19 pandemic hitting Europe, consumer confidence figures will garner plenty of interest.

From the U.S, it’s a busy week ahead. Key stats include retail sales and industrial production figures in the 1st half of the week. In the 2nd half, the focus will then shift to Philly FED Manufacturing and the weekly jobless claims figures.

Also of influence will be industrial production, retail sales, and unemployment numbers from China.

Away from the economic calendar, Brexit talks enter the final stretch ahead of the 19th November EU Summit deadline.

COVID-19 news updates and U.S politics will also influence.

Don't miss a thing!
Discover what's moving the markets. Sign up for a daily update delivered to your inbox

Trade With A Regulated Broker

  • Your capital is at risk
IMPORTANT DISCLAIMERS
The content provided on the website includes general news and publications, our personal analysis and opinions, and contents provided by third parties, which are intended for educational and research purposes only. It does not constitute, and should not be read as, any recommendation or advice to take any action whatsoever, including to make any investment or buy any product. When making any financial decision, you should perform your own due diligence checks, apply your own discretion and consult your competent advisors. The content of the website is not personally directed to you, and we does not take into account your financial situation or needs.The information contained in this website is not necessarily provided in real-time nor is it necessarily accurate. Prices provided herein may be provided by market makers and not by exchanges.Any trading or other financial decision you make shall be at your full responsibility, and you must not rely on any information provided through the website. FX Empire does not provide any warranty regarding any of the information contained in the website, and shall bear no responsibility for any trading losses you might incur as a result of using any information contained in the website.The website may include advertisements and other promotional contents, and FX Empire may receive compensation from third parties in connection with the content. FX Empire does not endorse any third party or recommends using any third party's services, and does not assume responsibility for your use of any such third party's website or services.FX Empire and its employees, officers, subsidiaries and associates, are not liable nor shall they be held liable for any loss or damage resulting from your use of the website or reliance on the information provided on this website.
RISK DISCLAIMER
This website includes information about cryptocurrencies, contracts for difference (CFDs) and other financial instruments, and about brokers, exchanges and other entities trading in such instruments. Both cryptocurrencies and CFDs are complex instruments and come with a high risk of losing money. You should carefully consider whether you understand how these instruments work and whether you can afford to take the high risk of losing your money.FX Empire encourages you to perform your own research before making any investment decision, and to avoid investing in any financial instrument which you do not fully understand how it works and what are the risks involved.
FOLLOW US