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European, US Equities Set for Cautious Rally as Investors Eye Central Banks

Markets brace for a positive start, driven by hopes of rate cuts and sector rotation. Key indicators and central bank comments will guide investor decisions.

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European, US Equities Set for Cautious Rally as Investors Eye Central Banks

European and US equities are poised to start Friday's trading session on a cautiously positive note, with banking, mining, tech, and metals shares expected to lead the rally. Investors will be closely watching central bank remarks, economic indicators, and sector-specific developments.

Markets are balancing between hopes of interest rate cuts and central banks' cautious stance, leading to sector rotation. In Europe, traders will keep an eye on Eurozone PMI, ECB officials' comments, and energy and commodity price movements. Across the Atlantic, US futures point to a modestly positive start, buoyed by optimism around potential Fed rate cuts and steady corporate earnings. Investors are expected to focus on new Fed comments, US data prints like PMI and jobless claims, and sector moves in tech, financials, and AI-related stocks.

Analysts at XTB anticipate a cautious and sideways consolidation phase for European markets like the DAX, given mixed PMI data and persisting uncertainties. They advise investors to tread carefully with short-term positions, despite the generally positive outlook.

Friday, October 3, is expected to see a cautiously positive start for US and European equities, with financials, tech, and metals likely to lead gains. However, investors should remain vigilant due to mixed economic signals and ongoing uncertainties, as advised by analysts at XTB.

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