The euro continues to gain ground against other major currencies during early Wednesday trading. The single currency is on a winning streak, having so far this week gained 1.8% to the dollar, supported by hopes of a de-escalation of the conflict in Ukraine, following talks in Turkey between representatives of Moscow and Kyiv, with both parts agreeing to make concessions. The euro is particularly exposed to the geopolitical risk posed by the war on its eastern flank, and to the resulting rises in oil and gas prices that threaten the economic growth prospects in the eurozone, and this is why the hope of a peaceful resolution for the conflict is lifting the single currency. However, Russia has backtracked on promises before, so the current gains may not last for long, should the prospect of a peaceful solution in Ukraine once again start to fade away.
Ricardo Evangelista – Senior Analyst, ActivTrades
European Shares
Stocks slid lower in Europe on Wednesday, snapping a 3threeday rally, as investors still need further confirmation of the recent progress towards reducing hostilities in the war in Ukraine.
The optimistic talks between Moscow and Kyiv have significantly sustained market sentiment and appetite for risk since the beginning of the week. President Putin recently announced the removal of some of his troops around the Ukrainian capital, which helped fuel hopes of a de-escalation of the conflict. However, scepticism remains, and investors are likely to look at upcoming developments in order to get confirmation tensions are easing. That said, today’s correction on most EU indices can also be explained technically as stock markets need to pull-back and establish a new floor following the recent clearing of major resistance, before reaching higher tops. The DAX-40 index is now trading close to the upper side of the tight range that has been containing prices for almost two weeks, with the 14,600 pts/14,630 as a key zone for Bull traders.
Experienced writer and journalist, working in the global online trading sector, Steffy is the Editor of LeapRate. She has previous experience as a copywriter and has been with the company since January 2020. Steffy has a British and American Studies degree from St. Kliment Ochridski University in Sofia.
