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EU Market Outlook - Markets Set For Headliners

Last updated 8/20/2012 1:32 AM EST (GMT -5) 0 Comments - Add your comment

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Andrew Taylor

Market Strategist, GFT

Follow @ATaylor_GFT

Top Headlines

o    Headlines set to make a comeback as leaders return from break

o    Troubled sovereigns still yet to make a formal request for aid to EFSF

o    Greece agrees to further cuts but still short of targets

Market Moves

·          All majors trade in pathetic ranges awaiting Europe

·          Equities sees limited direction as Corp Earnings fails to inspire

·          Commodities remain near highs set at Fridays close

In what is turning out to be a bit of a Monday ritual over the European summer months, the Asian session provided no fresh directional leads, instead waiting for early Europe to join the ranks and hopefully inject some life into the markets.

We should start to see headline volatility return as both European leaders and traders make their way back to the battle arena. The noticeable absence of daily drama has allowed players to squeeze short positioned markets higher knowing that the usual drip feed of negative information would not be around to deter their cause. This strategy will struggle as the liquidity and sense returns.

With no high impact economic data due out today markets will continue on with pricing in a potential long term shift by the US as it tries to stand on its own two feet and decouple itself from the growth perils of the world. It is way too earlier to call it a turn of any significance but traders can be certain that Quantative Easing by the Federal Reserve would barely be a thought in the current conditions and political climate. This should continue to weigh on risk sentiment knowing that there will no longer be that expected flood of printed money near term.

Economic Events to watch:

Note: Times are in GMT

0830 UK           Jul CML mortgage lending figures

0830 UK           Jul Bank of England capital issuance

0900 EU           Jun Construction output

1230 US           Jul Chicago Fed National Activity Index  

For more intraday analysis and trade ideas, follow me on twitter @ATaylor_GFT

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About The Author

Andrew Taylor's financial markets career started in 1991 in the interbank FX market,where he worked for one of the largest banks in Australia. Andrew then went on to trade on behalf of some of the biggest global banks, working across five of the world's major financial hubs: Sydney, New York, Singapore, Auckland, and Tokyo.

His more than 20 years of experience spans market borders and asset classes, covering global equities, commodities, options and futures. Andrew's wealth of trading experience and ability to communicate with traders of all levels has put him in demand as a first point of contact for clients and the media alike when seeking information and guidance.