The EU Majors’ Financial Figures, Italy Budget Crisis and Brexit Will Remain the European Stock Market Highlights
In the days to come, the EU stock market traders will be on the watch for the EU’s major’s financial figures that are currently being announced as well as for the Italy budget crisis updates and Brexit news.
Investors expect that Brussels will probably ask Italy to revise the country’s budget for 2019 and will reject the current version of the budget with the deficit set at 2.4% of GDP. In the meantime, another focus of interest for traders is Brexit. With the looming Brexit deadline of March 29, 2019, the UK needs to strike the withdrawal deal in November at latest so that it could go through the ratification process in time and take effect by the Brexit date. The no-deal Brexit is to be the ‘hard’ Brexit feared by investors.
On the positive side, the European market majors have recently announced their financial results that appear to be quite strong, which will underpin the EU stocks dynamics in the offing.
A negative thing is that the EU market-watchers apprehend a new rate hike by the US Federal Reserve that seems to believe that it makes sense to further raise rates amid the country’s strong economy according to the Fed minutes from its September meeting.
And again on the negative side, the US-China trade war tensions have never eased. Though the US Department of the Treasury has so far declined to label China as currency manipulator, the Treasury report says that China, along with five other countries, has currency practices that require close attention.
As the US-China trade quandary remains unresolved, the EU investors are wary that European car imports into the Unites States might be hit with higher tariffs. Meanwhile, as the car tariff hike threat appears to be less acute, the EU’s new light motor vehicles sales grew by 2.5% with 11.95 million new cars sold from January to September 2018.
Ivan Marchena, Libertex Analyst