European Stocks Slump On Fitch Downgrade

  • European stocks fell 1% after Fitch downgraded the US government’s credit rating, citing fiscal concerns and debt ceiling negotiations.

Freepik

  • Investors assessed corporate earnings reports while anticipating the Bank of England’s policy decision and US jobs data.
  • Companies like Hugo Boss and Haleon raised sales and revenue growth forecasts, while Siemens Healthineers confirmed outlook despite a profit drop.
  • ECB’s President Lagarde mentioned a possibility of a rate hike pause in September, amid Eurozone’s inflation easing to 5.3% and Q2 GDP growth at 0.3%.

The euro remains relatively unchanged against the dollar and indicates a potential inside day break or failure, mainly due to the presence of buying tails in yesterday’s session on the daily interval.

The exchange rate appears to be establishing a micro balanced price range as it trades around the middle, with possible absorption around the swing lows for core euro long positions.

In response to Fitch’s downgrade of the US government’s credit rating, equity markets are under pressure, leading investors to flow into safe-haven assets such as the dollar, Japanese yen, and Gold. Gold has seen an increase of about 0.4%, while the dollar index might experience selling during the New York trading session.

The higher dollar and positive volatility are additional pressure factors for the US equities sector. Investors may still choose to add to their core positions around the lower extreme, which could serve as a supportive level and resistance for sellers.


More By This Author:

US Stocks Mixed As Economic Data And Earnings Results Weigh On Market Sentiment
Chinese Stocks Slip As Manufacturing Contracts, Yuan And Bond Yields Under Pressure
US Stocks Close July With Modest Gains, Dollar Index Faces Monthly Decline

Like this article? Learn more about the VWAP with trusted and premium educational market insights with a subscription.

Visit our more

How did you like this article? Let us know so we can better customize your reading experience.

Comments

Leave a comment to automatically be entered into our contest to win a free Echo Show.
Or Sign in with