Oct 4, 2022
VOT Research Desk
Key Insights and Analysis
Tuesday saw a rise in European stock markets following a positive start to the new quarter in the previous session.
By 03:45 ET (07:45 GMT), the German DAX was up 1.9%, the French CAC 40 was up 2.3%, and the British FTSE 100 was up 1.1%.
After suffering sharp losses in the third quarter as a result of worries about slowing growth and aggressive monetary policy tightening, European equities have started the new quarter on a positive note.
The British government’s decision to reverse proposed tax cuts for high earners helped set the tone. However, this seriously undermines the authority of both Prime Minister Liz Truss and Chancellor of the Exchequer Kwasi Kwarteng and excludes only a small portion of the planned 45 billion pounds in unfunded tax cuts that were announced last week.
A smaller-than-anticipated 25 basis point increase in interest rates by Australia’s central bank on Tuesday also helped sentiment.
Tuesday’s economic data calendar is mostly empty, but investors will keep an eye on the August Eurozone PPI for more information about the region’s inflationary pressures. The index is anticipated to rise by 4.9% on a monthly basis and by 43.1% annually.
In business news, Greggs (LON:GRG) stock rose 8% after the British fast food chain’s total sales increased 14.6% year-over-year in the 13 weeks to October 1 despite a worsening cost of living squeeze.
Made.Com (LONDON:MADE) stock rose by more than 20% after the online furniture retailer stated that it had begun discussions with a “number of interested parties” regarding the company’s sale.
Metropole Television, on the other hand (EPA:Bertelsmann’s RTL Group abandoned a plan to sell its controlling stake in the French TV company, resulting in a 8% decline in MMTP) stock.
Tuesday saw a slight increase in oil prices, maintaining the upbeat mood of the previous session. The market is looking forward to Wednesday’s OPEC+ meeting, which is expected to result in a significant decrease in crude production.
Tomorrow’s meeting of the Organization of the Petroleum Exporting Countries and its allies, referred to as OPEC+, is expected to result in a cut in production of more than one million barrels per day.
After a significant drop in oil prices since the middle of the year, this move would be the largest supply cut since the COVID-19 pandemic.
U.S. crude futures were up 0.2 percent at $83.83 a barrel by 03:45 ET, while Brent futures were up 0.3 percent at $89.12.Gold futures rose 1% to $1,718.55/oz on Tuesday, while EUR/USD traded 0.6% higher at 0.9881—the largest daily gain since May—and both benchmarks gained more than 4%.
