Calm economic calendar leaves central bank chatter and COVID center of attention
It was a mixed weekend for the European majors on Friday.
The CAC40 slipped 0.12%, while the DAX30 and EuroStoxx600 posted modest gains of 0.12% and 0.13% respectively.
Economic data from Germany supported the DAX30 and EuroStoxx600 as consumer confidence rose.
Following the economic outlook of ECB President Lagarde, a recovery in consumer confidence was essential to align. Earlier this week, Lagarde had mentioned a likely recovery in consumer spending to support a faster economic recovery.
From the United States, however, economic data was mixed, limiting the day’s rise.
Eurozone economic data was calmer on Friday, with the focus on German consumer sentiment.
The Gfk Consumer Climate fell from -6.9 to -0.3, the highest level since August 2020.
According to June survey,
- Both economic and income expectations have seen marked increases.
- Revenue expectations jumped 14.6 points to 34.1, which was the highest level since 41.2 in February 2020.
- In June, the indicator of economic expectations jumped 17.3 points to 58.4 points, its highest level since 59 points in February 2011.
- However, the propensity to buy indicator rose slightly, which rose 3.4 points to 13.4 points.
The United States
It was another busy day on the economic calendar.
Personal spending and the Fed’s preferred inflation measures were the focus of attention later in the European session.
It was a mixed bag for the markets, however.
In May, personal spending stalled after rising 0.9% in April.
On the inflation front, the numbers suggest that further price spikes can be avoided.
In May, the Core PCE price index rose 0.5% month-on-month, after rising 0.7% in April. Economists were forecasting an increase of 0.6%.
Year over year, the Core PCE Price Index increased 3.4%, which is in line with expectations. In April, the Core PCE price index had risen 3.1%.
Other statistics included finalized consumer sentiment and consumer expectations which had a moderate impact on the majors.
For the DAX: It was a bearish day for the auto sector on Friday. Volkswagen and Daimler fell 1.37% and 1.33% to pave the way for the downside. Bmw and Continental experienced modest losses of 0.38% and 0.53% respectively.
It was, however, a bullish day for the banks. German Bank and Commerzbank ended the day with gains of 0.38% and 0.72% respectively.
From CAC, it was a mixed day for the banks. BNP Paribas and Agricultural credit increased by 0.67% and 0.57% respectively. Gen Soc reversed the trend, falling 0.14%.
It was also a mixed day for the French automotive sector. Stellantis SA increased by 0.41%, while Renault ended the day down 0.30%.
Air France-KLM and Airbus SE ended the day with losses of 0.83% and 1.43% respectively.
On the VIX index
It was a 5e consecutive day in the red for the VIX Friday.
After falling 2.14% on Thursday, the VIX fell 2.19% to end the day at 15.62.
The NASDAQ slipped 0.06%, while the Dow Jones and S & P500 ended the day up 0.69% and 0.33% respectively.