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The EuroStoxx 50 is expected to end 2024 with modest gains, reflecting a year of stagnation influenced by weak Chinese demand impacting luxury goods, rising risk premiums on French bonds, and concerns over US-Europe trade tensions. A technical analysis suggests a potential bullish breakout in early 2025, contingent on improved global economic conditions. However, a downturn remains possible if the economic outlook worsens.
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The Swiss stock market is set to open lower, with the SMI index down 0.24% ahead of the US Federal Reserve's monetary policy decision and UK inflation data. Analysts anticipate a 25 basis point rate cut from the Fed, despite concerns over inflation in a strong US economy. Roche is slightly up after receiving a CE mark for a new testing device, while Dätwyler faces a significant loss due to a restructuring plan.
Ethereum spot ETFs have seen a significant net inflow of $145 million, reflecting growing institutional interest, with BlackRock’s ETHA leading at $3.365 billion. Grayscale’s ETH also contributed, increasing its net inflow to $616 million, while cumulative net assets for Ethereum spot ETFs reached $14.04 billion.In related news, President-elect Trump met with Crypto.com CEO Kris Marszalek to discuss establishing a U.S. Strategic Bitcoin Reserve, aimed at enhancing economic security and consolidating government-held Bitcoin. This initiative follows Trump's engagement with other crypto leaders and coincides with Bitcoin hitting an all-time high of $108,268.45.
The Vienna Stock Exchange experienced losses on Tuesday, with the ATX index dropping 0.92% to 3,589.88 points amid cautious sentiment ahead of the Fed's monetary policy decision. EVN shares fell 8.2% after reporting lower revenue and profit, while insurance stocks like Vienna Insurance Group and Uniqa gained. Economic data showed mixed signals, with a surprising drop in Germany's Ifo business climate index and a decline in US industrial production, although retail sales rose ahead of the holiday season.
European Parliament member Sarah Knafo has proposed establishing a strategic Bitcoin reserve for Europe, inspired by similar moves in the US under Donald Trump's administration. Knafo argues this would protect citizens from inflation and opposes the European Central Bank's digital euro plans, citing concerns over economic freedom. Amidst this, Bitcoin's price has surged to an all-time high, reflecting growing global interest in the cryptocurrency.
Bitcoin is experiencing a bullish trend, with expectations of peaking between $160,000 and $290,000 by mid-2025 to early 2026, driven by increased institutional demand and the launch of Bitcoin ETFs. The cryptocurrency has surged 573% from its 2022 low and recently surpassed $100,000, indicating a strong market cycle. Analysts suggest that future corrections will be limited, maintaining the momentum as the market capitalizes on growing adoption and confidence in the sector.
Ethereum whale wallets now control 57% of the total ETH supply, the highest concentration since 2015, as smaller holders decline. This accumulation is seen as a bullish signal, coinciding with a price recovery near $4,000 and increased daily address creations. Analysts remain optimistic about ETH's potential to surpass its all-time high by early 2025, driven by broader market trends and institutional confidence.
European stocks closed slightly higher as investors awaited the U.S. Federal Reserve's interest rate decision. Renault shares surged 5.39% amid merger talks with Nissan and Honda, while U.K. inflation rose to 2.6%, dampening hopes for a rate cut from the Bank of England. The cost of renting in London jumped 11.6%, marking the fastest rise on record.
UBS faces challenges in China due to Xi Jinping's policies promoting "universal prosperity," which discourage high executive salaries and wealth concentration. The sluggish economy, exacerbated by a real estate crisis, has led wealthy clients to shift assets abroad, complicating UBS's operations. The bank hopes for a gradual economic stimulus from the Chinese government to stabilize the market and boost private consumption.
The Federal Reserve is expected to announce a 25-basis-point interest rate cut, lowering the federal funds rate to a range of 4.25% to 4.5%, marking the third consecutive reduction. This follows strong job growth and stable inflation data, although future cuts may be limited due to potential economic shifts under the incoming administration. Meanwhile, the crypto markets are experiencing volatility, with Bitcoin and Ethereum both seeing declines ahead of the Fed's decision.
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