Chinese Demand Worry Weighs On European Equities

Euro STOXX 50 futures are last -50 or so, sitting just above lowest levels of the day as fresh worry over the Chinese economy, in light of the softer than expected Q2 Y/Y GDP readings, weighs. The cash equivalent index sits ~1% softer on the day, after bulls failed to force a retest of cycle highs during last week’s rally.

• Consumer discretionary names lead the declines on a sectoral basis, which is no surprise given the Chinese fondness of European luxury goods alongside the latest questions re: Chinese domestic demand.
• The health care and financial sectors find themselves at the other end of the performance table, lodging modest gains on the day.
• Technically, VG1 futures traded higher last week. The rally resulted in a move above the 50-day EMA at 4,335.00 and through 4,371.00, the Jul 6 high. Clearance of the latter level highlights a potentially stronger bull cycle and attention is on key resistance and the bull trigger at 4,447.00, the Jul 3 high. Key support/the bear trigger has been defined at 4,220.00, the Jul 7 low. Initial support is at the 50-day EMA.