Daily Alert – Wednesday 11th January 2023: Looking good in the Euro zone

Mark NugentDaily Alert, Jan 2023

Daily Alert – Wednesday 11th January 2023: Looking good in the Euro zone

Good morning.

Monday’s continuation of last week’s US equity bullishness, which I criticised as being due to confirmation bias relating to the prior Friday’s US Average Hourly Earnings number, did not survive to the end of the day. Mid-afternoon’s risk-on sentiment ended up being indecisive by the close of the daily candle.

Tuesday was a bit better, seeing risk-on sentiment. The biggest equity moves were seen outside the US. European equities are outperforming due to the likely avoidance of an energy crisis which will boost growth and limit inflation, the surprise re-opening of China which is a major export market for many Euro zone firms, and the lack of the big tech drag which we see in US equities.

I placed no trades. I am in no hurry to rush into the markets. Tomorrow’s US CPI will be an important data point.

I’ll be back tomorrow.

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