Choppy trading in Europe as miners drag Indices lower | Traders watch Middle East events

<p>European markets were dragged lower by weakness in heavyweight mining stocks on Thursday in choppy trading. Financials however found support after the European Banking Authority […]</p>

European markets were dragged lower by weakness in heavyweight mining stocks on Thursday in choppy trading. Financials however found support after the European Banking Authority said European banks had raised €205 in new capital to shore up their finances.

By 10am, the FTSE 100 was trading lower by 14pts at 5811 whilst the German and CAC indices also lost 0.3%.

The miners have been a key drag on European markets with the FTSE 350 mining sector losing the most in trading, falling 1.2%, closely followed by oil stocks who are playing catch up to the 4% slump in the price of oil yesterday.

Traders are eyeing developments in the Middle East too, where continued instability in Syria is seeing investors vacate oil stocks on production concerns in the broader region. This, alongside speculation that the next tranche of loans to Greece will be delayed until November is keeping investors on the back foot.

We have interest rate and QE decisions to come from the Bank of England at noon and the European Central Bank at 12.45pm. No movement is expected in either decision, though naturally investors remain somewhat cautious in case of any surprises from both central banks.

US factory orders are expected to slump -6% in August and so this could well be a somewhat sensitive piece of economic data in the afternoon session, whilst we also have the FOMC minutes released after the close of European trading.

With US non-farm payrolls due out tomorrow, there is a degree of trader positioning taking place today, with traders looking to diversify ahead of the jobs release tomorrow which typically brings about some added price volatility.

Build your confidence risk free
Join our live webinars for the latest analysis and trading ideas. Register now

StoneX Financial Ltd (trading as “City Index”) is an execution-only service provider. This material, whether or not it states any opinions, is for general information purposes only and it does not take into account your personal circumstances or objectives. This material has been prepared using the thoughts and opinions of the author and these may change. However, City Index does not plan to provide further updates to any material once published and it is not under any obligation to keep this material up to date. This material is short term in nature and may only relate to facts and circumstances existing at a specific time or day. Nothing in this material is (or should be considered to be) financial, investment, legal, tax or other advice and no reliance should be placed on it.

No opinion given in this material constitutes a recommendation by City Index or the author that any particular investment, security, transaction or investment strategy is suitable for any specific person. The material has not been prepared in accordance with legal requirements designed to promote the independence of investment research. Although City Index is not specifically prevented from dealing before providing this material, City Index does not seek to take advantage of the material prior to its dissemination. This material is not intended for distribution to, or use by, any person in any country or jurisdiction where such distribution or use would be contrary to local law or regulation.

For further details see our full non-independent research disclaimer and quarterly summary.