EUROSTOXX50: European Indices Fell Down After the Terrorist Attack in Brussels
EUROSTOXX50: European Indices Fell Down After the Terrorist Attack in Brussels
The explosions which were fired this morning in Brussels has hit European stock indices. Belgium special services believe that the explosions were the terrorist attack.
Since today’s opening session the index EuroStoxx50 fell by 2% to the level of 2993.0 versus yesterday’s closing price. However, following the release of the positive preliminary data on business activity indices in the manufacturing and service sectors of Eurozone at 11:00 (GMT+2), which were above the forecast, European indices including EuroStoxx50, went up and regained some of the losses.
Preliminary composite index of purchasing managers (PMI) in Eurozone rose to 53.7 in March versus 53.0 in February and the forecast of 53.0. The index proves the increase in economic activity. At the same time, the rise in the number of new orders is insignificant. Preliminary index of consumer confidence released yesterday fell in March (-9.70 against the forecast of -8.15 and -8.80 in February). The index shows consumers’ confidence in the economic situation. European companies continue to reduce selling prices and ECB will face difficulties trying to go back to the target inflation level slightly below 2%.
European indices hardly reacted to the monetary policy easing decision by ECB in March. If ECB does not adopt additional measures on monetary policy easing European stock indices, including EuroStoxx50, can continue to decline.
Probability of introduction of the additional incentive measures in Eurozone have been mentioned by some key figures of the European Central Bank. Last Friday, the chief economist of ECB Peter Pratt said that economic situation in Eurozone has been deteriorating and the decline in the interest rates would become one of the possible options of resolving the problem. Recall that ECN has lowered the basic interest rate to 0.00%, the rate on deposits has been reduced to -0.4%. The program of bonds redemption was increased by 20 billion, up to 80 billion Euro per month. It was by 10 billion more than expected by the market participants.
The material has been provided by LiteForex - Finance Services Company - www.liteforex.com
