After a negative start to the session, European stock markets turned mixed-to-positive, steadying due to upbeat quarterly earnings that helped to counter lockdown worries and stimulus concerns. In particular, strong results from Swiss bank UBS, consumer giant Reckitt Benckiser and others offset worries about tighter coronavirus curbs across the continent. UBS rallied 2.5% as it posted a 99% jump in quarterly profit, while Swedbank gained 0.3% after it reported a bigger-than-expected growth in net profit. Logitech International jumped nearly 20% after the company raised its full-year forecast.
On the negative side, Ireland announced some of the toughest constraints, while Italy, Spain, and the UK also imposed curbs to limit the spread of new cases. Investors are also nervous as the spokesman for House Speaker Nancy Pelosi said she hoped to be able to say whether talks can be completed by the end of Tuesday.
Against this backdrop, the UK FTSE 100 index gains 0.34% to 5,904, Italy’s FTSE MIB adds 0.44 percent to 19,459, France’s CAC 40 rises by 0.13 percent to 4,948, while the German DAX 30 sheds 0.32% to 12,812. U.S. stock index futures are rising ahead of a deadline for a new fiscal stimulus deal from Washington.
In currencies, the dollar is mostly lower as risk sentiment looks mixed on Tuesday. The USD index DXY gradually approaches the 93.00 handle, a break below which could pave the way to the mid-September lows in the 92.70 region. At that, USDJPY extended the advance, having exceeded the 20-DMA in recent trading. However, the bullish potential still looks limited as the technical signals point to a neutral picture now and don’t suggest that the greenback will overcome the 105.70 area.
Meanwhile, oil prices have resumed bullish attempts after yesterday’s rejection from the $43.55 local resistance. As of writing, Brent crude was trying to regain the $43 handle, up 0.21% on the day. Despite the futures refrain from a deeper bearish correction, chances of extending the current advance in the near-term are limited as demand-related worries continue to persist, with US political uncertainty remaining elevated. In a wider picture, the prices could proceed to a more sustainable recovery if the pandemic satiation begins to improve substantially.
Nathan Lambert, Head of Global FX Analytical Department