European Stocks Set to Climb for Fourth Straight Day on Economic Data
European stocks have generated gains in the last three consecutive trading sessions as stronger than expected economic data has been optimizing investor’s sentiments. The stock futures are in green for the fourth straight day on Wednesday despite the scheduled FOMC meeting.
Investors appreciated Chinese economic recovery as the world’s second-largest economy is coming out of the coronavirus slump. This is because the country has reported the first retail sales growth since the pandemic hit the country early this year.
It’s August retail sales jumped 0.5% from the prior-year period while the unemployment rate dropped to 5.6% in August. Moreover, the country also saw robust industrial activity growth of 5.6% in August from the past year period, marking its fifth consecutive month of increases.
On the other hand, the United Kingdom has reported a 5.3% year-on-year increase in grocery sales last month. In Europe, investors have been showing confidence in the German economy. The travel and leisure sector is likely to report gains ahead as the impact of coronavirus started fading all over the world.
US stock markets have also reported big gains in the past couple of days, thanks to the tech market rally. All three US stock market indices are in green since the beginning of this year. However, the level of volatility is higher as investors don’t exactly know how the economy would behave in the final quarter this year.
“The market’s trying to figure out what to do next, and in those times you always see volatility,” said Jerry Braakman, chief investment officer of First American Trust in Santa Ana, California, which has around $2 billion in assets under management. “We’ve been trying to figure out if this tech run is here to stay.”
What Does it Mean for Investors?
- FOMC policy decision could significantly impact the stock market performance.
- Gold and oil prices are moving higher.
- Euro jumped to $1.19 level while the US dollar retreated slightly.