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European Markets Pulled Back Early on May 23

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May. 23 2018, Published 8:22 a.m. ET

The United Kingdom

Following a strong performance for eight trading weeks, the United Kingdom’s FTSE 100 Index started this week on a stronger note and closed at fresh record-high price levels in the first two trading days this week. The FTSE 100 Index opened lower on May 23 and was trading with weakness in the morning session.

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Market sentiment

The market sentiment was strong at the beginning of this week amid decreased geopolitical tensions. The sentiment weakened in the opening hours today amid Asian markets’ weak performance and fresh concerns over the outcome of the US-China trade talks. There was increased caution in the FTSE 100 Index before the United Kingdom’s inflation data were released. The market started to rebound after the data were released. According to the Office for National Statistics, the United Kingdom’s consumer price index declined to 2.4% in April—the lowest reading in a year.

At 4:40 AM EST, the FTSE 100 Index was trading at 7,835.25 with a drop of 0.54%. The iShares MSCI United Kingdom (EWU) gained 0.08% to $37.26 on Tuesday.

Germany

After closing Tuesday at the highest levels traded since February, France’s CAC 40 Index opened lower on May 23. The DAX 30 Index opened lower amid US and Asian markets’ weak performance due to concerns about US-China trade relations. In the morning session, weaker-than-expected manufacturing data weighed on the DAX 30 Index. According to Markit Economics, Germany’s manufacturing PMI (purchasing managers’ index) declined to 56.8 in May, which is less than the forecast of 57.9. At 4:45 AM EST, the DAX 30 Index was trading at 12,989.75—a drop of 1.4%. The iShares MSCI Germany (EWG) declined 0.12% on Tuesday.

France

After starting this week on a stronger note by surging to the highest levels traded in a decade, France’s CAC 40 Index lost momentum on Tuesday amid raising Italian bond yields. The CAC 40 Index opened lower on May 23 amid the decreased global risk appetite and traded with weakness in the morning session. On the economic data front, according to Markit Economics, France’s manufacturing PMI improved to 55.1, while the services PMI declined to 54.3.

At 4:50 AM EST on Wednesday, the CAC 40 Index was trading at 5,567.27—a drop of 1.3%. The iShares MSCI France (EWQ) gained 0.06% on Tuesday.

Next, we’ll discuss how US markets performed on May 22.

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