Different news makes markets volatile

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Last week the PMI releases delivered on their highly anticipated comeback. It started with Manufacturing Purchasing Managers’ Indices showing mostly positive figures around the Eurozone. These included Italy, with a print of 51.4 versus the anticipated 50.8 and Germany with 52.7 versus expectations for 52.5, not to mention the U.K.’s PMI, which scored no less than 58.4 points, 2.3 more than analysts had predicted. Expectations for increased local demand seem to have weakened the Euro as it began trading at around 1.3540 USD soon after the release of the PMIs, 0.5% below the levels that were traded just before their release. 

The Euro’s upside, however, came from a rather unpredictable front, as Tuesday saw surprising pessimism in its equity market. The German DAX index lost nearly 2% during the trading day, while the Paris CAC 40 presented even higher losses. One asset’s pessimism is another’s opportunity, it seems; as the Euro’s weakness from the previous day diminished rather entirely, with EUR/USD trading back at around 1.3600 levels. 

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Black Friday optimism

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Friday presented opportunity for market optimism on both sides of the Atlantic. The Eurozone saw positive data published regarding the demand side, with prices increasing by an estimated 0.9%. Unemployment also provided its fare share as it decreased to 12.1%. That supported the German DAX index and the Spanish IBEX35, closing the week at +1.6% and +1.1% weekly increases respectively. At first, U.S. markets didn’t appear to need any data derived support; Although no positive figure was released in the U.S. on Friday, markets opened with a positive trend, due to optimism based on what appeared to be strong "Black Friday" consumer demand. The S&P 500 gained +0.2% throughout the trading day and the NASDAQ and DJIA complimented with similar figures. This reverted, however, as reports from leading U.S. retailers suggested local demand wasn't as strong as it seemed, leading both the Dow, as well as the S&P to conclude the day in negative territory. Register at ANYOPTION and start trading TODAY!