Following a weak performance for three consecutive trading weeks, the United Kingdom’s FTSE 100 Index (UKX-INDEX) carried the weakness forward to this week and declined in the first two trading days of the week. On Wednesday, the FTSE 100 Index opened higher and traded below opening prices with mixed sentiment in the morning session.
An increased sell-off in the US bond market raised inflation concerns and triggered a global market sell-off this week. After a sharp decline on Tuesday to the levels in April 2017, the FTSE 100 Index moved higher in the opening hours. However, the index didn’t stay above opening prices. Increased volatility and uncertainty in the market persisted on Wednesday and acted against the index. Weakness in US market futures in the early hours on Wednesday weighed on the global market sentiment. On the economic data front, according to Halifax Bank Of Scotland (HBOS), the U.K. Halifax House Price Index declined 0.6% in January, while the market was expecting 0.2% growth.
At 3:50 AM EST today, the FTSE 100 Index was trading at 7,181.50—a rise of 0.56%. The iShares MSCI United Kingdom (EWU) rose 2.2% to 35.3 on February 6.
Following a two-week losing streak, Germany’s DAX 30 Index (DAX-INDEX) started this week on a weaker note. After falling to the lowest levels traded since September 2017, the DAX 30 Index opened higher on Wednesday. The mixed sentiment in Asian markets and overnight rebound of major US equity indices are supporting the DAX Index in the morning session. On the economic data front, according to data released by Destatis today, Germany’s industrial production declined 0.6% in December—a bigger decline than the forecast of 0.4%.
At 4:00 AM EST on February 7, the DAX Index was trading at 12,446.67—a gain of 0.41%. The iShares MSCI Germany (EWG) rose 3.1% on February 6.
Following a pullback last week, France’s CAC 40 Index carried forward the weakness and declined to five-month low price levels on Tuesday. The CAC 40 Index opened higher on Wednesday but traded with mixed sentiment at opening prices in the morning session. On the economic data front, according to the Ministry of Finance, France’s trade balance declined by 3.5 billion euros in December—better than the forecast of a decline by 4.9 billion euros.
At 4:05 AM EST today, the CAC 40 Index was trading at 5,181.25—a gain of 0.36%. The iShares MSCI France (EWQ) rose 2.8% on February 6.
In the next part, we’ll discuss how the US Dollar Index and Treasury yields performed in the early hours on February 7.