European stock markets are headed higher once again on the open this morning, continuing last week’s buying spree which gave us the biggest weekly rally in a year.
GFT is quoting the FTSE 100 index to open up 35 points from Friday’s close, at 5,167. The German DAX is also expected to start higher, up 30 points at 6,095, and the French CAC is forecast to open up 22 points at 3,576.
Although a positive start is likely then, it’s doubtful that the nervy sentiment has completely disappeared just yet, with many traders still wary of a double-dip recession in Europe and the States. Trading styles seem cautious, and that is likely to continue as we head into the US second-quarter earnings season which kicks off with Alcoa’s report today. Also out this week we have Intel, General Electric, JP Morgan and Bank of America. There is a growing belief that this reporting season could throw up some big surprises to the upside, although given the question marks surrounding the European debt situation and the potential toll it could have on the US, key will be the corporate profits outlooks. Positive language means we could expect the general fear factor which has gripped markets for the past few months to erode further. Delayed data on UK GDP data is released today, which could attract even more interest than usual after “potential errors” postponed the announcement from two weeks ago.
Martin Slaney is director of global dealing operations for GFT
