Stocks in Europe are trading significantly higher at the beginning of a new week after investors welcomed reassuring news on the evolution of Covid-19 over the weekend. The fact that nations like Italy, Spain and the US, who have been the most impacted by the deadly virus so far, have reported a slowing in both death toll and new daily cases on Sunday is reviving market sentiment this week. In addition to the reactions of governments and central banks to the crisis, many investors desperately wanted to see some progress on the actual spread of the virus to lift the uncertainty surrounding most markets. However, it is still too soon to say the bottom is behind us now as this weekend’s reassuring numbers will have to be confirmed over the next few days with volatility on most stock markets likely to increase. All benchmarks are performing strongly in Europe today, led by the industrial and financial sectors this morning.
Today’s best performers are the German DAX-30 Index and Paris’ CAC-40. Technically speaking, the French benchmark opened up a bullish gap of 150 points at the market open today and this has pushed the price above their bearish trendline, invalidating the short-term bearish correction started at the end of March. This bullish signal has also been confirmed by the RSI indicator which has returned above the 50% level. The market cleared the 4,250pts-4,285pts zone and this level will now play a support role to the price while 4,335pts presents major resistance before fresh highs towards 4,470pts, 4,585pts and 4,700pts can be reached.
