European Stocks Sharply Lower; German GfK Sentiment Falls to Record Low
European stock markets traded sharply lower Wednesday, pressured by renewed energy concerns as well as a deteriorating growth outlook.
By 03:35 ET (07:35 GMT), the DAX in Germany traded 1.6% lower, the CAC 40 in France fell 1.5%, and U.K.’s FTSE 100 dropped 1.9%.
European equities are following the global move lower, with investors concerned that aggressive monetary tightening to combat soaring inflation will push much of the global economy into recession.
The European Central Bank has embarked on a series of interest rate hikes to combat inflation at historic highs, despite the region suffering from slowing growth and an energy crisis in the wake of Russia’s invasion of Ukraine.
Influential investment bank Goldman Sachs expects the ECB to hike interest rates by 75 basis points at its October and December meetings, adding to raised borrowing costs of 125 basis points at its last two meetings.
The forward-looking German GfK consumer climate index fell sharply to -42.5 in October, a drop to another record low from the downwardly revised -36.8 the previous month, as fears grow that soaring inflation stemming from dwindling Russian gas supplies will eat into incomes.
FTSE 100 Technical Analysis: Daily Chart
In the daily charts, FTSE 100 is trading in down channel. FTSE 100 is currently trading below all SMA.
RSI is in over sold zone which indicates mild bullishness. MACD is currently below zero which indicates bearishness.
Its immediate support is 6898.00 & the resistance level is at 6990.80.
FTSE 100 INDEX will trade in down channel until there is trend reversal.
How to Trade FTSE 100 Index this Week:
FTSE 100 INDEX will follow the downtrend until their trend reversal. So, remain bearish on FTSE 100 INDEX.