European Equity Market Handover Plenty aversion post rare earth threat

Stock market snapshot as of [29/5/2019 2:06 PM]

There are major questions about the effectiveness and sustainability of a possible move by Beijing to restrict rare earth exports, as claimed by China’s state-controlled Global Times newspaper
Nonetheless, European stock markets are flirting with March lows as the broad STOXX gauge drops as much as 1.5%
Read why 'Rare earths should be on your radar screen' by City Index's Chief Technical Strategist, Asia, Kelvin Wong
That investors are taking no chances demonstrates that a higher level of underlying risk aversion now prevails than earlier in the year
Technical chart aspects in U.S. indices are also keeping investors nerves elevated. With S&P 500 mini futures trading down about a tenth of a percentage point at 2785 a short while ago, the S&P 500 is poised to open under the ‘psychological' level of 2800, where support has been frequently observed since late-March
Loss of the pivotal price and approach to the closely-eyed 200-day moving average around 2775 promise to keep the market on tenterhooks and volatility on the boil

Corporate News

Shares of China-dependent raw materials producers and those of technology hardware firms, which tend to have intricate global supply chains, continue to underperform. STOXX’s Mining & Metals sub-index was down 2.5% just now, among the weakest industrial sectors
The IT index was close behind, with a 2.2% fall, as Tech Hardware, semiconductors and software components all contribute to the downside
The mining and metals sector has another centre of gravity in steel giant ArcelorMittal which has tumbled as much as 7.3% to print a 25% year-to-date loss. The group will cut European production as it scrambles to tackle falling global demand and rising regional imports
Satellite TV group ProSiebenSat.1 Media is among a handful of blue-chip bright spots as it joins a wave of broadcasters defending against Netflix incursion by consolidating. Silvio Berlusconi-controlled Mediaset has bought an almost 10% stake
U.S. consumer shares are again in the spotlight as Michael Kors owner Capri heads 7% lower and Abercrombie & Fitch faces a 16% drop after disappointing quarterly releases

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