1. European stocks are set to close 2022 on a bearish sentiment due to macroeconomic factors such as the ongoing Russia-Ukraine war, record high inflation, and tightening monetary policy.
2. The Euro to US dollar derivative has been below the ratio of 1 for the first time since the 2008 financial crisis in 2022.
3. The STOXX Europe 600 Index Continuous Contract is down approximately 12 percent in the past twelve months.
European stocks are set to close 2022 on a bearish sentiment as global markets prepare to close trading later today. The macroeconomic factors such as the ongoing Russia-Ukraine war, record high inflation, and tightening monetary policy have caused investors to become more bearish in their outlook for the Eurozone. The Euro to US dollar derivative has been below the ratio of 1 for the first time since the 2008 financial crisis in 2022, further exacerbating the situation. The STOXX Europe 600 Index Continuous Contract has been down approximately 12 percent in the past twelve months, providing further evidence of a bearish sentiment.
As the geopolitical tensions between Russia and Ukraine continue, investors are increasingly worried about the potential implications of an extended conflict. Inflation has also been on the rise in the Eurozone, which has resulted in a weakening of the currency. The European Central Bank (ECB) has been tightening its monetary policy in an attempt to combat inflation, but this has had the effect of further weakening the Euro.
Cryptocurrency and big tech companies from the United States have also been on a downward trend in the past twelve months, adding to the bearish sentiment in the Eurozone. Additionally, the current pandemic has had a negative impact on the European economy, leading to further economic uncertainty and investor pessimism.
Overall, it appears that the European stocks are likely to close the year 2022 on a bearish sentiment. Investors are likely to remain cautious in their outlook and are expected to remain wary of any potential risks that could further weaken the Eurozone economy. As the geopolitical tensions and inflation persist, it is likely that the bearish sentiment in the Eurozone will continue into 2023 and beyond.