The most important week of 2024 has finally arrived. This Tuesday the US presidential elections will take place between Kamala Harris (Democrats) and Donald Trump (Republicans). Two days later, on Thursday the 7th, another of the events that is moving the market will take place: the meeting of the US Federal Reserve. All of this as the earnings season enters its final stretch in both the United States and Europe.
With this background scenario, the futures of the main world stock markets begin the day with slight falls in Europe. At the moment, the declines are very moderate and even waver between positive and negative. On Wall Street, the tone is also two-tone, with the Dow Jones registering timid declines, while the S&P 500 and the Nasdaq 100 advance around 0.3%.
The EuroStoxx 50 closed last week losing, on an intraday level, the support marked from Ecotrader at 4,900/4,870 points. The portal expert premiumJoan Cabrero, points out that now the continental index can open the door to a potential fall to the lows of the month of September at 4,720 points, of which currently The selective one is 3% away.
In the worst case, the EuroStoxx could retreat to 4,675/4,700 points, which would widen the losses on current levels to 4%. However, this setback would be, for Cabrero, “an opportunity to buy the European stock market again with a much more attractive risk-return equation than weeks ago.” The situation will not be more dramatic as long as the index does not lose what is known as red line: August lows at 4,470 points.
“In this sense, think that there will be no weakness nor will I recommend drastically reducing exposure to the European stock market as long as the EuroStoxx 50 does not lose the August lows of 4,470 points. I would consider reducing it a little if it gives up the September lows in the 4,730 points and above all the 4,675/4,700 points, which is the adjustment of 61.80/66% of the entire last rise from the August lows,” concludes the expert.
Fixed income market
With the US elections and the Fed meeting around the corner, the US 10-year bond places its profitability at the levels of the month of July, at 4.38%. Not only the T-Note scale to these levels, but sales are widespread in the rest of the debt papers, both longer and shorter term: 2, 5 and 30 year bonds also reach maximum yields for the month of July.
In Europe, the roadmap is practically similar and the bundle German also establishes itself at levels from four months ago, at 2.4%. Peripheral debts such as those of Italy and Spain return to the maximum levels of the month of September, with yields of 3.68% and 3.11% respectively.
The currency market will be another of the hot spots to watch this week due to the elections, since a weakness in the dollar is assumed. For now, The dollar begins the week registering its biggest fall against the euro since the end of September and placing the exchange rate at 0.917 euros per dollar.
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