DAX Keeps Uptrend, While European Stocks Little Changed

It’s a quiet start to the new month, with overall risk sentiment mixed. European stock markets show little change but the DAX continues the uptrend, as the chart below shows. With North American markets closed for a holiday, trading is subdued, giving traders a relatively uneventful start to the extended weekend.

Dax Index Chart H4 – The 20 SMA Holding as Support

Currency and Bond Market Price Action

The JPY kept falling for most of the European session, as bond yields edge higher, pushing USD/JPY up by more than a cent, briefly crossing the 147 mark. The US dollar isn’t experiencing broad-based gains though; it’s up against some major currencies but down against others, with minimal movements. EUR/USD , GBP/USD , and AUD/USD are all up by 0.1%, while the New Zealand dollar and Canadian dollar are underperforming slightly across the board.

European Markets and Trading Sentiment

European stock indices are showing minimal changes, reflecting a balanced market sentiment. Although there was a slight dip early in the European session, indices reversed higher towards the close, ending the day with only minor shifts. The lack of major market movements can be attributed to the US holiday, giving European traders little incentive to make significant moves. Some early selling was noted, but the markets stabilized, closing flat.

While today has been calm, price action could pick up tomorrow, as September is historically a volatile month. Traders will be watching closely for any developments later in the week, that could shake up the markets and bring more activity. Below are the changes at the European close, with Dax 40 making some slight gains.

Main European Stock Indices at the Close

• Stoxx 600: Closed flat, showing no significant change in overall European market sentiment.
• German DAX: Edged up by +0.1%, indicating a slight positive bias in the German market.
• France’s CAC: Gained +0.2%, reflecting mild optimism in the French stock market.
• UK’s FTSE 100: Declined by -0.2%, suggesting some selling pressure or cautious sentiment among UK investors.
• Spain’s IBEX: Ended the session flat, with no major changes observed.
• Italy’s FTSE MIB: Down by -0.1%, showing a marginal decline in the Italian market.

These mixed results suggest that European markets are generally in a wait-and-see mode, with investors assessing the impact of economic data later in the week and global market conditions. The overall lack of significant movement indicates cautious sentiment amid concerns over economic growth, inflation, and European Central Bank actions, as markets expect another 25 bps rate cut by the ECB this month.

German Index Dax Live Chart