CAC 40 is trading down 1.14% at 5953.78
European stock markets are expected to open higher Tuesday, rebounding to a degree after the previous session’s sharp losses, but concerns remain that aggressive monetary tightening will stunt economic growth in the region.
At 2 AM ET (0600 GMT), the DAX futures contract in Germany traded 1% higher, CAC 40 futures in France climbed 0.9% and the FTSE 100 futures contract in the U.K. rose 0.1%.
European equities closed sharply lower Monday, following the global trend after last week’s hot U.S. inflation report nixed hopes that price rises were peaking. This was seen increasing the chances that the Federal Reserve, which announces its latest rate decision on Wednesday, will continue its aggressive monetary tightening for longer than already priced in.
The European Central Bank confirmed late last week that it intends to start its rate hiking cycle in July, and suggested that another increase in September will depend on the inflation data over the summer.
German consumer prices rose 0.9% on the month in May, data showed Tuesday, after a gain of 0.8% the previous month. However, the annual figure climbed to 7.9%, from 7.4% in April, suggesting that the ECB has its work cut out controlling inflation in the Eurozone’s largest economy.
On technical fronts CAC 40 RSI stood at 20.77 and currently it is trading below all MA. So, SELL position can be taken with following target and stoploss:
TRADE SIGNAL – : CAC 40 – SELL: 5954.90, TARGET: 5931.40, STOP LOSS: 5968.90
