Europe: A Light Week ahead, Yet Earnings Would Dominate Movements...

Daily Forex Fundamentals | Written by ecPulse.com | Apr 20 09 12:50 GMT |

A second light week ahead of us, where companies' earnings would be the major player in boosting confidence or snatching it away, yet Germany's fundamental calendar contain some interesting news about the level of confidence in Europe's leading economy. Credit Crisis waves stroke the euro area's firm growth fence, destroying its fundamentals gradually, where we witnessed a contracting growth in the second and third quarter of the prior year extending to the fourth quarter. The last three months of the year had faced a 1.6% contraction, which according to projections a deeper contraction took place in the first three month of the year after production stalled and demand weakened heavily. In the prior three months the manufacturing and services sector stalled heavily, pushing the PMI reading deeper into contraction levels, as those reading made markets believe that a deeper contraction will take place. However, expectations clears that the PMI manufacturing and services readings improved in April supported by the slight retrieved demand across the globe. Yet if the PMI readings dip in more contractions then concerns will add up on the ones available, where market participants no longer trust the ECB especially they mixed markets up when they reduced their benchmark by 25 basis points long with the deposit rates trimmed down to 0.25% from the previous 0.50%. In addition, the ECB chairman said that deposit rates won't be reduced below those levels because the disadvantages of zero rates on the economy would be brutal. Moreover, we are waiting for the German IFO readings, according to market, projections the IFO business climate would inch higher to 82.3 levels followed by expectations inching higher to 82.6 levels, yet the current situation remain gloomy pressuring the current reading to 82.1 levels. Recession is deepening, we do not really know until when recession will deepen and when growth will pick up pace once again in order into an expansion rather than a contraction. European indices fell in today mid session, crippled by earning concerns, where Dow Jones euro stoxx fell 2.43% reaching 2283.41 levels, the French CAC 40 index fell 2.57% reaching 3012.62 levels and the German DAX fell 2.89% reaching 4542.41 levels. So dear reader lets just wait to see what would this week fundamentals reveal to us, and if any changes in the outlook will take place. Ecpulse disclaimer: The content of ecPulse.com and any page in the website contain information for investors/traders and is not a recommendation to buy or sell currencies, stocks, gold, silver & energies, nor an offer to buy or sell currencies, stocks, gold, silver & energies. The information provided reflects the writers' opinions that deemed reliable but is not guaranteed as to accuracy or completeness. ecPulse is not liable for any losses or damages, monetary or otherwise that result. I recommend that anyone trades currencies, stocks, gold, silver & energies should do so with caution and consult with a broker before doing so. Prior performance may not be indicative of future performance. Currencies, stocks gold, silver &energies presented should be considered speculative with a high degree of volatility and risk