The stock markets of Europe are concerned about the US economy
Pressure on the mood of European investors continue to have fears about a trade war between the US and China. The US President Donald trump said that the United States is not willing to reach a deal with China on trade, noting that the dialogue continues. The uncertainty is resolved trade dispute between the US and China, contributes to market volatility.
In addition, investors paid attention to the fact that the American Bank Goldman Sachs lowered its growth forecast for the U.S. economy, noting increased risks of recession. Thus, the Bank reduced the growth forecast of U.S. GDP for the fourth quarter by 0.2 percentage points to 1.8% and predicts that the company can reduce costs and investment under uncertainty. In addition, Goldman Sachs believes that the trade agreement between the US and China is unlikely before the US presidential election in 2020.
Current week investors, including in Europe, waiting for the publication of statistics on retail sales and industrial production in China in July, to assess the impact of trade wars on the Chinese economy. According to analysts, the growth of industrial production of the country in the reporting month amounted to 5,8% yoy against a growth of 6.3% in the previous month, while growth in retail sales slowed to 8.6% from 9.8% a month earlier.
Bidding also deters tension on the political situation in Italy. Vice-Prime Minister of Italy, leader of the “League” Matteo Salvini informed the Prime Minister of the country, Giuseppe Conte, in Parliament no majority to support the government, and informed him of the need for early elections.