European stock markets advance for the 2nd session in a row, but are expected to accumulate losses this week

By Sergio Caldas

São Paulo, 01/19/2024 – European stock exchanges operate mostly higher this Friday morning, extending gains from the previous session, but the balance of the week tends to be negative amid uncertainties about the outlook for global interest rates.

At around 6:35 am (Brasília time), the pan-European Stoxx 600 index advanced 0.32%, to 471.95 points. During the week, however, it still accumulated losses of around 1%.

In recent days, comments from authorities at the European Central Bank (ECB) have cooled expectations of a possible interest rate cut in the euro zone this semester. The president of the ECB, Christine Lagarde, signaled that the first reduction will probably come during the European summer. Soon, starting at 7am (Brasília time), Lagarde will participate in a panel in Davos, Switzerland, on the last day of the World Economic Forum.

This week, doubts also arose about possible interest cuts in the United Kingdom, after British consumer inflation (CPI) data exceeded expectations, and also about the moment at which the Federal Reserve (Fed, the US central bank) could begin to reduce your interest rates. The hypothesis that the first cut in the US will come in March is still the majority, but by a small margin, according to CME Group's monitoring tool.

In today's macroeconomic news, UK retail sales fell 3.2% monthly in December, much larger than expected, while German producer inflation (PPI) fell at a stronger pace than expected , also last month.

At 6:49 am (Brasília time), the London Stock Exchange rose 0.47%, the Paris Stock Exchange increased 0.08% and the Frankfurt Stock Exchange gained 0.16%. Milan's had an increase of 0.13%, while Madrid's and Lisbon's were hovering close to stability.

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