European markets start with small gains – data eyed

<p>European markets started the new week with small gains as stronger miners balanced out a weaker opening for UK banks. Investors are likely to focus […]</p>

European markets started the new week with small gains as stronger miners balanced out a weaker opening for UK banks.

Investors are likely to focus more on economic data than company earnings this week. The amount of firms yet to report across the pond that moves the market is now much less and this week we have economic data of real importance including EU manufacturing, UK GDP, US GDP and rate decisions both from the Bank of England and the Federal Reserve. With this in mind, it may be a rather slow start to the week until we get into the depths of the data due out.

It is the stronger mining sector that is keeping European Indices afloat this morning, as much of their gains is helping to counter weigh weakness in the banks and tech stocks. We have Copper prices rallying 1% higher and this has given correlated strength to buyer demand for mining stocks.

On the downside however it is banking stocks that are a key drag on Indices, with Royal Bank of Scotland the worst performing equity on the FTSE 100, falling 2.7% as investors react to Vickers’ speech on banking reform and lock in profits from Friday’s strong move higher when its shares rose near 6% on speculation of an early exit from the Asset Protection Scheme.

In wider European equities, Philips was also a key drag after the electronics firm reported a lower than expected fourth quarter net profit and warned that consumer sentiment will continue to be subdued this year. The firm reported net profit of €465m, way short of market consensus with the majority of investors expecting a figure closer to €530m. Due to actual profit figures falling such a long distance away from market expectations, investors have moved quickly to sell their holdings in the electronics firm whose shares have subsequently fallen over 6% in early trading.”

Join our live webinars for the latest analysis and trading ideas. Register now

GAIN Capital UK Limited (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.