The European stock market kick-started the week on a positive note on Monday, with a modest rise observed across the board. This slight uptick is a reflection of the positive sentiment among investors and traders in the region.
The German stock market index, Dax, remained relatively stable, barely deviating from its closing level on Friday. Meanwhile, the United Kingdom’s FTSE 100 and France’s CAC 40 both experienced a slight rise, with an increase of 0.2 percent and 0.1 percent respectively. These minor changes indicate a cautious optimism among investors in these markets.
However, the broad Euro Stoxx 600, which provides a comprehensive overview of European stocks, struggled to register significant gains, with a marginal increase of only 0.2 percent.
Across the Atlantic, the United States stock market futures experienced a dip from their peak readings on Friday. This followed an interview given by Jerome Powell, the head of the Federal Reserve, on television. Powell revealed that the Fed would approach interest rate cuts more cautiously in the coming year. This revelation came as a surprise to the market, which had already factored in interest rate cuts for March and May. As a result, market expectations had to be adjusted. The European Central Bank (ECB) is also expected to monitor the Fed’s pace when considering its own interest rate cuts.
In other news, Italian banking giant Unicredit reported a net profit of 2.81 billion euros in the last quarter of the year, surpassing analysts’ expectations. The bank further pledged to return up to 8.6 billion euros in capital to its investors in the current year. The bank’s guidance suggests that this year’s results will match the high performance of the previous year.
On the back of this positive news, Unicredit’s share price jumped by 7.9 percent when the stock market opened.
Furthermore, British telecom operator Vodafone reported higher-than-expected turnover for the third quarter of its fiscal year. The company attributed this performance mainly to robust business sales.
Despite the positive report, Vodafone’s share price, which has been underperforming in recent years, fell by 1.8 percent on the stock exchange.
Today, the final readings of the purchasing managers’ indices for service industries in the euro area will be released. These preliminary readings were first announced in January, and it is expected that there will not be significant revisions to these figures, which have remained at recession levels.
Additionally, the producer price index for the euro area for December will be available by noon. The anticipation is that producer prices dropped by 0.8 percent on a monthly basis in December, and by 10.5 percent compared to the same period the previous year.