A new wave of U.S. attacks on Iran and rising inflation are putting sellers back in the driver's seat.
A sharp 1.62% correction for the S&P 500 to 7,267 points, a "jump" in oil toward $94 per barrel for Brent, and the VIX/CBOE above 22 points mark traders’ initial reaction in the markets.
Earlier, sell-offs and pressure in Asian markets, along with S&P 500 futures trading at a 0.53% premium at 7,305 points, point to another volatile session on European stock exchanges.
For Europe, the situation is becoming even more serious, on the one hand due to energy costs, and on the other...long-standing issue, as Angeliki Papamiltiadou reveals regarding the Eurogroup, and on the other hand because the ECB is being pushed toward raising interest rates—by 25 basis points today—which, according to economists’ estimates, will not be the only hike in 2026. All this at a time when Europe is running out of steam, with economic growth hovering at the margin of statistical error.
The session in Frankfurt opened at lower levels, with the DAX at 24,195 and futures down 0.25%.
Investors also started lower on the Greek stock market, with the General Index at 2,373.21 points, and the worst avoided thanks to the outperformance of Coca-Cola HBC and OTE, as noted by Thanasis Stavropoulos.
The session had a distinct selling bias, as 15 stocks were down compared to 10 up, with the FTSE25 at 6,016.95 points.
Turnover stood at 230 million, with 36.6 million via pre-arranged orders and approximately 115 million in just four stocks: Piraeus Bank, National Bank of Greece, Alpha Bank, and PPC.
With sellers dominating—and due to the dividend ex-date—for Eurobank and ETE, and with the battle over the Katseli law still ongoing, traders are unlikely to shift from a short to a long position in the short term. Unless, of course, the mood in New York shifts dramatically, bringing buyers back to European bank stocks.
The EuroStoxx Banks is down at 265.77 (-0.75%) with futures trading at a discount. Attention is clearly turning to Frankfurt as well, not so much for the interest rate to be announced—but rather for Lagarde’s statements—though some analysts anticipate that the French official’s remarks will be along the lines of “business as usual.”
Developments on the political front are already being factored in by investors, with Filippos Pantazis referring to the New Democracy party’s pre-election campaign launch, aimed at securing a third term. It is widely acknowledged that the timing of the elections influences—at least in part—the stance of businesspeople and investors, with all that this may entail.
However, developments in the business sector are also interesting. Whether they concern the new dynamics in telecoms brought about by the PPC-Vodafone partnership, according to the report by Eva Kantilari, and Giorgos Fintakis, the positive outlook for Quest Holdings despite the "thorn" of Romania, or the Lamda deal with the Italians of ION, as reported by Stelios Bouras, or even the latest on the scale of Barba Stathis—according to Alexandra Gitsis— the sector is teeming with significant developments.
Whether this will be reflected, at least in the short term, is evident from the positive divergence seen, for example, in yesterday’s session beyond Coca-Cola HBC (52.10), OTE (18.80), and PPC (22.40), HelleniQ Energy (10.09), Lamda Development (6.495), Sarantis (15.14), Cenergy Holdings (24.06), and AIA (10.21) among the large caps. And ADMIE (4.18), AEM (5.45), Hellenic Exchanges (7.58), PPA (37), and Profile (7.71) among the FTSEMidCap stocks.
Selective trading is likely to continue, with stock picking being adopted by part of the market during yesterday’s session.