European share markets had a mixed opening on Wednesday following Tuesday’s session which saw prices erase their early gains at the end of a volatile trading session. This sudden change in investors’ trading stance took place after EU officials struggled to reach a common plan on measures to mitigate the negative impact of the pandemic and aid the recovery from it. In addition, investors also realised the epidemic was still far from controlled amid high death tolls yesterday. This has had a big impact in reversing any bullish market sentiment that had been built over the past few days with investors now likely to remain cautious ahead of new concrete information, data and important meetings such as today’s FOMC minutes.
There have been no significant moves in Europe so far with most benchmarks trading slightly lower amid lower levels of volatility today. The steepest decline comes from Paris where the CAC-40 Index is being led down by energy shares as investors look to reduce their exposure ahead of today’s release of US crude oil inventories as well as this week’s highly anticipated meeting in which Russia and Saudi Arabia will try to reach an agreement to bring more stability to oil markets. The French CAC-40 is currently challenging its first available support at 4,365pts (38.2% Fibonacci retracement) before the main one located at 4,315pts (50% Fibonacci). The 21-day moving average has already turned around and now plays a resistance role to the market. However, the 4,315pts level combined with the 150-pts wide gap zone between 4,290pts and 4,140pts should represent a solid support zone and may prevent the market from declining further.
