GER30 Mixed after Upbeat EZ GDP Revision, ahead of ECB Policy Decision
GER30 Analysis
The European economy grew by 4.1% in the second quarter on annualized basis and by 0.8% quarter over quarter, according to the final figures releases earlier today, marking an upbeat revision over the preliminary reading.
However, GER30 fails to benefit from the encouraging figures since fears over the adverse effects of the energy crisis on the economy persist, with Russian Gazprom having indefinitely shat down gas flow via Nord Stream 1. [1]
Industrial production in Germany dropped 0.3% in July from +0.8% prior, a month during which the pipeline was closed for 10 days.
CEO of German gas giant Uniper – which had been bailed out by the government earlier in the summer - warned yesterday on CNBC that the worst is yet to come. [2]
Moreover, today's GDP data may play into the hand of ECB member that prefer a jumbo rate hike at Thursday's meeting. In July, the bank had taken key interest rate out of negative territory with an 0.5% move and officials have made hawkish remarks recently, which creates possibility of an equal or even bigger hike this time around.
The next leg of the GER30 move will likely be determined by the outcome of tomorrow's ECB meeting, which can also spur volatility, warranting caution.
From a technical perspective, the index is in precarious position and in risk of fresh 2022 lows (12,373), although a steeper decline below 12,135 that will bring 11,519 in the spotlight, will require a catalyst.
On the other hand, GER30 covers earlier losses and may get the chance to push for the EMA200 (13,130-90), but will need daily closes above this levels for the near-term downside bias to pause. Even then, the upside has any roadblocks from mid-13,000s and above, starting with the daily Ichimoku Cloud.
Nikos Tzabouras
Senior Financial Editorial Writer
Nikos Tzabouras is a graduate of the Department of International & European Economic Studies at the Athens University of Economics and Business. With extensive experience in market analysis and a strong foundation in international relations, he brings a unique perspective to financial markets. Nikos emphasizes not only technical analysis but also on fundamentals and the growing influence of geopolitics on financial trends.
As a Senior Financial Editorial Writer, he delivers comprehensive and forward-looking insights across a wide range of asset classes, including equities, commodities, and currencies. His work explores how macroeconomic events, political developments, and global policies impact market dynamics, providing readers with a deeper understanding of both short-term movements and long-term trends.
References
| Retrieved 07 Sep 2022 https://twitter.com/GazpromEN/status/1565759390782742529 | |
| Retrieved 19 Apr 2026 https://www.cnbc.com/2022/09/06/uniper-says-worst-is-still-to-come-as-russia-halts-gas-flows-to-europe.html |
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