EuroStoxx50: Positive dynamics in the index will continue. Fundamental analysis for 09.08.2016

With the opening of today’s trading session the European stock indexes are rising. This morning the data on trade balance of Germany and the budget of France in June was released. It became known that the surplus of trade balance in Germany amounted to 21.7 billion euro against 22.1 billion euro in May. The decline in the index was caused by the decrease in exports and the increase in imports. Adjusted exports have increased by 0.3% and imports by 1.0% compared with the previous month.

The budget deficit of France grew to 61.8 billion EUR on annual basis in June against 58.5 billion Euro a year ago, but declined against the level of the previous month (65.7 billion euro). in June.

According to last week data, the composite index of purchasing managers (PMI) in the manufacturing sector of Eurozone in July was revised upward to 53.2 from 52, exceeding the value of 53.19 in June. The revised index of business activity in the services sector of Eurozone has also increased in July (52.9 against 52.7).

Economic growth of the largest economies of Eurozone, including Germany, is slowing down.

This week, traders’ attention will be focused on the data on European and German GDP, which will be released on Friday (09:00 and 11:00 GMT+3 respectively). German’s GDP is 4% of the global GDP and 30% of the European GDP. This fact, as well as the rate of inflation, is the main criteria in monetary policy decisions of the ECB.

In case of the weak data, the ECB, may introduce more monetary policy easing in Eurozone, which can have a positive impact on the European stock market.

The meeting of the ECB will be held on 8 September. As you know, the ECB did not change monetary policy in July, and the ECB President Mario Draghi did not any indications of the future policy of the Bank in his speech.

Favourable data on GDP of Eurozone and Germany released last Friday has a positive impact on Euro and European stock market.

EuroStoxx50: Positive dynamics in the index will continue.  Fundamental analysis for 09.08.2016