The Euro stock indices recorded significant losses yesterday after the US dollar overtook the Euro in value. The losses from yesterday have been carried into the market again today as investors await both the French and German flash services. The manufacturing PMI gives insight into the average performance of various European companies in the past month. This helps investors predict the future prices of the Euro stocks, which move the Euro stock indices market at large.
Major Euro stock indices EU50, GER30, FRA40, IT40, and ESP35, have almost lost close to 100 pips in their market value from yesterday until now.
EU50, which measures the average performance of the most significant fifty stocks in the Euro stock market, lost over 80.4 pips yesterday. The index fell from the day’s high at 3717.7 to close lower at 3637.3. The index is seen ranging at 3652.1 during the Asian session today.
GER30, which measures the performance of the most valuable thirty German stocks, lost over 329 pips yesterday, with the index falling from 13531.94 to a new low at 13198.74. The index is seen ranging at 13229.30 during the Asian session today.
FRA40, which tracks the average performance of the most significant forty French stocks, lost over 181 pips yesterday, with the index falling from 6365.3 to a new low of 6347.2. The index is seen ranging at 6355.7 during the Asian session today.
IT40, which tracks the performance of the most popular forty Italian stocks, lost over 85.1 pips yesterday, with the index falling from 22429.7 to 22044.6. The index is seen at 22157.1 during the Asian session today.
ESP35, which tracks the performance of thirty-five most significant Spanish stocks, lost over 58.5 pips yesterday, falling from 8287.7 to a new low of 8229.4. The index is seen at 8266.4 during the Asian session today.
Investors hope for positive readings from these data to drive back investments into the Euro stock market, pushing up the Euro stock indices.
The French and German flash services and manufacturing PMI are two different reports from the French and German sectors.
The French and German Flash services PMI measures the index diffusion level of the purchasing managers within the service industry. A higher reading from this report above 50.0 indicates a healthy industrial sector. The forecast for this data in the French industry is 52.9, with the previous reading being 53.2. Regarding the German sector, the forecast for this data is 49.0, with the previous record being 49.7.
Moreso, the French and German Flash Manufacturing PMI measure the index diffusion level of the purchasing managers within the manufacturing industry. A higher reading shows that industry managers have made more purchases, and production is expected to increase suitably for the company’s stock and index market. The forecast for this data in the French sector is 49.0, while the previous record was 49.5. The forecast for this data in the German sector is 48.0, while the previous record was 49.3.
How do the French and German flash services and manufacturing PMI affect the Euro stock indices?
Reports from these flash services and the manufacturing PMI are essential economic data. Investors should pay great attention as it helps measure the strength of the manufacturing industries within the eurozone. Higher readings from these two reports show the industrial sector is healthy and often attracts more investors into the country. This causes the Euro indices to flourish.
On the contrary, a lower reading from this report shows a general weakness in the Euro industrial sector. This discourages investors and could result in a fall in the prices of the major Euro stock indices.
Forecast
EU50 is currently above the support at 3645.6. A break below this could trigger more downside to the lower-level support at 3630.4. However, the significant resistance for this index is seen at 3747.0.
ESP35 is currently on a bearish trend. The primary support for this index is seen at 8251.0. Its significant resistance is at 8287.5.
FRA40 is currently sitting on a support level at 6354.3; a break below it could trigger more downside. The significant resistance for this index is seen at 6379.8.
GER30 is currently above its primary support level at 13205.0. A break below it could trigger more downside with the target as 13083.0. The upper resistance for this index is seen at 13417.4.
