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21/05/24
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STOXX 600 In Europe Closes Down on Rate Uncertainty
On Tuesday, European stocks closed down, the third out of 4 sessions in negative territory, as caution about interest rate cuts dominated, with investors awaiting economic data due later this week.
The STOXX 600 pan-European index closed down 0.2%, after earlier in the session reaching a one-week low, with luxury stocks and banks leading sectoral losses, about 0.9% lower each.
The Italian share index, which is lender-heavy, fell behind regional peers and dropped 0.6% to an over one-week low.
Since European Central Bank policymakers cautioned against expectations of successive interest rate cuts in Jun. and Jul., the STOXX index has dropped from record highs.
According to the LSEG rate probabilities app, traders expect cuts worth 0.66% from the ECB by the end of the year, with the first likely to be in June.
Negotiated wage data for the Eurozone for the first quarter together with May manufacturing data will be released on Thursday and may provide clues on the economic state and the route of interest rates.
The focus will also be on minutes from the previous policy meeting of the Fed and Nvidia’s earnings on Wednesday to determine if the recent momentum that pushed European and U.S. equities to record highs continues.
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