Bearish weekend for European majors Friday, majors registering a 2sd loss of the week.
The DAX30 fell 0.72%, with the CAC40 and EuroStoxx600 posting losses of 0.95% and 0.90% respectively.
The disappointing business climate figures in Germany lashed the majors that day.
After the Evergrande and FED rescue rally on Thursday, the mood deteriorated at the end of the week. Uncertainty over Evergrande’s future remained until the weekend.
The IFO Business Climate Index in Germany fell from 99.6 to 98.8, while the current valuation sub-index fell from 101.4 to 100.4. The Business Expectations sub-index fell from 97.5 to 97.3.
The United States
Economic data was limited to housing sector data for August, which had a moderate impact on the majors.
For the DAX: Friday was a mixed day for the automotive sector. Bmw slipped 0.09% to reverse the trend for the day. Daimler however recovered by 1.80% to lead the way, with Continental and Volkswagen ending the day up 0.02% and 0.08% respectively.
It was a bullish day for the banks. German Bank and Commercial bank recorded gains of 1.69% and 1.20% respectively.
From CAC, it was a bullish day for the banks. BNP Paribas and Agricultural credit increased by 0.80% and 0.24% respectively, with Gen Soc up 1.11%.
It was also a bullish day for the French automotive sector. Stellantis SA and Renault ended the day up 0.12% and 2.37% respectively.
Air France-KLM recovered 3.09%, while Airbus SE decreased by 1.10%.
On the VIX index
It was a 4e consecutive day in the red for the VIX Friday.
After falling 10.73% from Thursday, the VIX fell 4.72% to end the day at 17.75.
The NASDAQ slipped 0.03%, while the Dow Jones and S & P500 ended the day up 0.10% and 0.15% respectively.
The day to come
It’s a calm day ahead on the eurozone economic calendar.
There are no important statistics outside the eurozone to give direction to the majors. On the monetary policy front, ECB President Lagarde is expected to speak. Expect comments on the economic outlook and monetary policy to provide direction.
Later in the day, durable goods and basic durable goods from the United States will influence later in the day. A further pick-up in basic durable goods orders would help.
Outside of the economic calendar, news from Evergrande will continue to be an area of interest.
In the futures markets, at the time of writing, the Dow Mini was up 144 points.
For an overview of all of today’s economic events, check out our economic calendar.