Forex Trading

European stocks rise as geopolitical tensions ease and earnings season looms

Tracking financial profitability in the face of rising rates

European equity indices kicked off the new week on a firmer footing, supported by easing geopolitical tensions and ahead of key earnings releases in the US and Europe.

While US Megatech names will likely hog the spotlight, this week’s focus of the European earnings season will be on banking names, including Deutsche Bank, Barclays, and Lloyds. Investors will be eagerly looking for clues on how higher interest rates are impacting profitability and whether the post-banking crisis rally in banks’ share prices can continue to run.

In terms of macro data, investors will closely look at the release of European and UK PMI data tonight and the German Ifo business survey to fine-tune the expected timing of the first BoE and ECB rate cut, currently 65% priced to start in June.

What is expected from EA PMI for April

Date: Tuesday, 23 April at 6pm AEST

In March, the Eurozone composite PMI printed at 50.3, the highest level in ten months. This was a significant improvement from 49.2 in February and marked a return to growth for the eurozone’s private sector for the first time since May last year.

For April, the market is looking for an improvement to 50.9, driven by growth in Germany and France, with a broad-based improvement expected across most sectors.

EA PMI decrease over five years

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