European indices experienced minimal changes at the start of the week. Eurostoxx, Germany DAX, France CAC 40, and UK FTSE each rose by 0.1%, while Spain’s IBEX fell by 0.1%, and Italy’s FTSE MIB decreased by 0.6%.<\/p>\n
Stellantis announced a net loss of \u20ac2.3 billion in the first half, largely due to tariff impacts. The S&P 500 futures increased by 0.2%, contributing to a steady market sentiment. Upcoming US-EU trade talks are a point of attention before the 1 August deadline. Tech stocks are awaiting earnings reports from Google\/Alphabet and Tesla later in the week.<\/p>\n
Given the tentative mood Low describes, we see the current calm as an opportunity. The Euro Stoxx 50 Volatility Index (VSTOXX) is hovering near a three-month low around 14, making options relatively cheap. We believe this is an ideal time to purchase protection or position for a significant market move before one materializes.<\/p>\n
The approaching August 1st deadline for US-EU trade talks presents a binary event risk that the market is underpricing. Historically, such trade deadlines, like those seen during the 2018-2019 period, have triggered sharp increases in volatility regardless of the outcome. We suggest traders could buy straddles on the Germany 40 index, positioning to profit from a large swing once a decision on steel and aluminum tariffs is announced.<\/p>\n
The foreshadowing from the carmaker’s loss is a critical signal for sector-specific plays. Recent data from the European Automobile Manufacturers’ Association (ACEA) already shows new car registrations in the EU fell by 2.6% in the first half of the year, confirming underlying weakness. Consequently, we are looking at buying put options on the STOXX Europe 600 Automobiles & Parts index to hedge against further tariff-related fallout.<\/p>\n
While European macro issues are key, the mention of US tech earnings should not be ignored, as they often dictate sentiment for global growth stocks. A strong report from a company like Alphabet could lift the entire tech sector, including European counterparts like SAP and ASML. For this, we see value in short-dated call options on European technology ETFs to capture any potential positive contagion from across the Atlantic.<\/p>\n
Create your live VT Markets account<\/a>\u00a0and\u00a0start trading<\/a>\u00a0now. <\/b><\/p>\n","protected":false},"excerpt":{"rendered":" European indices mostly steady; Stellantis posts \u20ac2.3B loss; markets await US-EU talks, tech earnings.<\/p>\n","protected":false},"author":62,"featured_media":16994,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[59],"tags":[],"class_list":["post-26846","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-live-updates"],"acf":{"acf_article_selection_author":null},"aioseo_notices":[],"_links":{"self":[{"href":"https:\/\/www.vtmarkets.com\/en-ca\/wp-json\/wp\/v2\/posts\/26846","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.vtmarkets.com\/en-ca\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.vtmarkets.com\/en-ca\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.vtmarkets.com\/en-ca\/wp-json\/wp\/v2\/users\/62"}],"replies":[{"embeddable":true,"href":"https:\/\/www.vtmarkets.com\/en-ca\/wp-json\/wp\/v2\/comments?post=26846"}],"version-history":[{"count":0,"href":"https:\/\/www.vtmarkets.com\/en-ca\/wp-json\/wp\/v2\/posts\/26846\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.vtmarkets.com\/en-ca\/wp-json\/wp\/v2\/media\/16994"}],"wp:attachment":[{"href":"https:\/\/www.vtmarkets.com\/en-ca\/wp-json\/wp\/v2\/media?parent=26846"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.vtmarkets.com\/en-ca\/wp-json\/wp\/v2\/categories?post=26846"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.vtmarkets.com\/en-ca\/wp-json\/wp\/v2\/tags?post=26846"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}