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Daily market commentary: CPI data from China revived inflation worries.



GOLD

The gold price is slowing down after yesterday’s recovery. Gold tested the key resistance zone of $1,750/1,760 and so far has been stopped at that level. But all this could be temporary, as bullion is recovering momentum and a clear surpass of this level could generate a new rally for gold. Moreover, the stimulus recently announced by the US government, could be another supportive element for the yellow metal. It is likely that investors are looking for new market drivers, starting with US inflation figures which will be announced next week. Macroeconomic data could tell us more about the status of the US and global economy and its recovery after the shock of the last year. These indicators will have an effect on monetary policies and, of course, on gold demand as a safe haven.

Carlo Alberto De Casa – Chief analyst, ActivTrades

daily market analysis

EUROPEAN SHARES 

European equities were trading slightly lower at Friday’s open, without clear direction, following a negative Asian session as Chinese inflation weighs on market sentiment. Even if most investors were recently reassured by FED officials confirming the need to persist with the current strong monetary support to the economy, today’s CPI data from China revived inflation worries. While the current investment landscape remains significantly positive for stocks on the mid-term, some investors, pushed by the prospective of higher borrowing costs, prefer to take some profits following record highs registered by many benchmarks.

Traders will keep trying to get more clues about the inflation outlook, so today’s focus is likely to stay towards macro data, especially with the US Producer Price Index due later in the afternoon. Today’s best performance comes from Milan despite the FTSE-MIB index breaking its bullish trendline and trading below the strong 24,420 pts level.

Pierre Veyret– Technical analyst, ActivTrades


Disclaimer: opinions are personal to the authors and do not reflect the opinions of LeapRate. This is not a trading advice.

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Daily market commentary: CPI data from China revived inflation worries.

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