European equities remain confident at the start of the new year. Despite Wall Street’s mixed behavior yesterday and a warmer tone at the start, European indices remain higher today. That spreads the positive tone from the start of the year even further, at least for now.
Eurostoxx 50 + 0.4%
Alemania DAX + 0.6%
Francia CAC 40 + 0.5%
UK FTSE +0.2%
Spain IBEX +0.1%
It is noteworthy that the CAC 40 index has gained nearly 3% for the week, setting new all-time highs.
The issues with tech stocks don’t really affect the European indices, which are made to lean more towards the value of the stock. In a year where growth margins may moderate, Europe may see another stellar performance once again. But it’s still early days and who knows what the next twist in the pandemic/inflation story will be.
Looking the other way today, S&P 500 futures are down 0.1%, Nasdaq futures 0.4%, while Dow futures are flat.
The weak tone in tech stocks is largely isolated for now, but if they drop further it could drag risk sentiment lower and spoil the good mood in European stocks as well. So you have to take that into account.