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European Stock Futures Higher; Strong Future Growth Expected

Stock Markets Jan 08, 2021 02:03AM ET
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© Reuters

By Peter Nurse 

Investing.com - European stock markets are seen opening higher Friday, with investors looking beyond record deaths from Covid-19 cases and U.S. political turmoil and expecting a strong economic recovery in the second half of the year.

At 2:05 AM ET (0705 GMT), the DAX futures contract in Germany traded 0.7% higher, CAC 40 futures in France climbed 0.9% and the FTSE 100 futures contract in the U.K. rose 0.3%.

Wall Street hit record highs on Thursday. Investors are looking to the incoming Democratic-controlled U.S. government for additional fiscal spending, while European economies are also set to get a boost from the European Recovery Fund.

“2021 is starting on the wrong foot, with the eurozone economy still struggling,” said ING analyst Peter Vanden Houte, in a research note. “But even though the vaccination process will be drawn-out, we believe that from the second quarter and beyond, some of the excess savings households built up in 2020 will be unleashed, boosting consumption.”

With this in mind, investors are prepared to overlook the rising number of Covid-19 cases: Germany recorded the most fatalities since the pandemic started, the associated national lockdowns throughout Europe and the hesitant start to the vaccination program. The U.S. also notched over 4,000 deaths in a single day for the first time.

Additionally, late Thursday President Donald Trump finally conceded that President-elect Joe Biden would take control of the White House later this month, for the first time condemning the violence that broke out on Wednesday when his supporters stormed the U.S. Capitol while lawmakers were confirming Biden’s election victory.

Turning to economic data, German industrial production rose 0.9% in November, ahead of expectations, but the key economic release will be the December U.S. nonfarm payrolls number, after Wednesday’s ADP release suggested the country’s jobs recovery had ended.

In corporate news, Swiss banking giant Credit Suisse (SIX:CSGN) said it expects to book a net loss for its fourth quarter after increasing its provisions for a long-running legal dispute in the United States by $850 million.

Oil prices edged higher Friday, continuing the bullish tone created by Saudi Arabia’s surprise announcement earlier this week that it would voluntarily cut output by one million barrels per day for the next two months.

This move has helped to allay worries over declining fuel demand due to the pandemic surge and the associated increase in restrictive measures.

U.S. crude futures traded 0.7% higher at $51.16 a barrel, while the international benchmark Brent contract rose 0.6% to $54.72. Both benchmarks are on track to post gains of around 5% this week, and are trading around the highest levels seen since February last year.

Elsewhere, gold futures fell 0.3% to $1,908.40/oz, while EUR/USD traded 0.1% lower at 1.2263.

 

European Stock Futures Higher; Strong Future Growth Expected
 

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Comments (3)
Wendy Muller
Wendy Muller Jan 08, 2021 2:19PM ET
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Print Germans print remember how it ended last time lol
Ridha B younes
Ridha B younes Jan 08, 2021 3:34AM ET
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gold and silver plunge on euro session opening why ?
Stu Pid
Stu Pid Jan 08, 2021 3:34AM ET
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Gold and silver usually gain during turmoil there’s a reason they are called safe heavens
Ivan Hrnjak
Ivan Hrnjak Jan 08, 2021 3:34AM ET
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Investors getting out of safe heavens and in to stocks, with the prospect of future economic recovery.
Mike Chen
Mike Chen Jan 08, 2021 2:29AM ET
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Euphoria markets will bring tsunami soon. The huge debts are piling high. Save some cash for the coming disaster.
Deepak Mohan
Deepak Mohan Jan 08, 2021 2:29AM ET
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Hi Mike, I am new to trading. Could you please explain me in detail?
Deepak Mohan
Deepak Mohan Jan 08, 2021 2:29AM ET
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Hi Mike, could you please explain me in detail?
Deepak Mohan
Deepak Mohan Jan 08, 2021 2:29AM ET
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sorry for the spam, it got glitched.
Paul Hulstein
Paul Hulstein Jan 08, 2021 2:29AM ET
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You could be right. Am using gold for leverage
 
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