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Brussels believes the eurozone’s economy will grow by 1.8% in 2014 and 1.8% in 2015, which is a 0.1% revision upward for both years. The German equity benchmark initially moved higher following the announcement, but was dragged back lower by the sell-off in global equities.
Yesterday, the FTSE 100 closed at its highest level in 14 years and the S&P 500 hit a personal best. There was therefore a bit of profit-taking in index futures this morning, but equity markets moved lower when the New York Stock Exchange opened at 2.30pm (London time). The financial markets do not move in straight lines so it is not unusual to see a pull-back from time to time.
The DAX is still in an uptrend, trading above the 50-, 100- and 200-day moving average over the past 18 months, though it is currently trading down 0.4% at 9670. As Brenda Kelly stated last week, the 9590 level is providing support. If we take out the recent high of 9720, it could put 9800 in sight.