EU markets open lower Monday, China reports steep economic decline

EU stock futures open lower on Monday despite positive close on Wall Street Friday evening

European stock markets opened lower Monday, starting the week with a bearish note despite bullish closures on Wall Street Friday evening.

London’s FTSE 100 futures were down by 0.89% this morning with Germany’s DAX futures following at a 0.69% decline and France’s CAC 40 futures down over 1%.

The pan-European STOXX 600 futures were down 0.33% Monday morning.

US stocks closed on a positive note Friday evening with NASDAQ 100 surging by 3.70% closing above the $12,300 mark, the S&P 500 gained 2.39% and closed above the $4,000 mark meanwhile the Dow Jones Industrial Average (DJI) rose by 1.47% to close above the $32,000 value, for the first time in a while.

Oil prices dropped

Oil prices fell on Monday morning as fears continue to grow over supply and the European Union prepares for the import ban on Russian oil.

Brent Crude futures were down 1.87% Monday morning valued at $109.69 a barrel. West Texas Intermediate (WTI) futures also fell by over 1.4% costing $109.94 a barrel.

Both benchmarks were up around 4% Friday with WTI even surpassing its highest price per barrel at $111.71 since 28 March 2022.

Gold follows oil in bearish start to week

Gold followed oil prices in the early trading hours of Monday morning with spot gold down 0.36% at $1,8005.44 per ounce. Gold futures were down 0.27% Monday morning sitting at $1,803.60 per ounce.

Gold prices have been on a fourth straight weekly decline, having fallen by over 1% last Friday.

Platinum futures were also on a decrease Monday morning falling by 0.34%. Other precious metals, however, were on the rise with palladium futures surging by 0.91% and silver futures up 0.15%.

China reports steep decline in economy amid COVID-19 lockdowns

While COVID-19 might seem like a long-forgotten nightmare in the West, China continues to battle the pandemic. After having introduced full and partial lockdowns in a number of cities in March and April 2022, the country suffered a steep decline in its economy.

April sales were down by 11.1% since 2021, the biggest decline since March 2020, the country’s National Bureau of Statistics (NBS) announced on Monday.

Catering revenue was down 22.7%, meanwhile the country’s car sales dipped by over 47%. Industrial production was down nearly 3% from a year earlier and below the 0.4% growth expectation.

Major Chinese markets were performing poorly Monday morning following China’s economy news.

• The Shanghai Composite was down 0.47%
• The Shenzhen Composite followed this decline at 0.65%
• The broader Hang Seng index fell by 0.37%

The NBS did add however on Monday that the country’s economy is expected to improve in May as consumption would surge.

Wheat prices surge around 6% amid India export ban

India imposed a ban on wheat exports on Saturday amid fears of food security partly tigered by the war in Ukraine as well as a heatwave which decreased wheat growth rates and hit domestic prices.

Although India is not the only global wheat supplier, the ban could drive wheat prices up.

US wheat futures were up 5.59% Monday morning.

Elon Musk accused of breaching an NDA

Elon Musk said on Twitter on Saturday that the social media application’s legal team has accused him of violating a non-disclosure agreement by revealing that the company’s bot check sample size was 100.

“Twitter legal just called to complain that I violated their NDA by revealing the bot check sample size is 100! This actually happened,” Musk tweeted.

The Tesla CEO tweeted on Friday that his $44-billion deal to purchase the company was “temporarily on hold” as he waited for more data to come out on the platform’s proportion of its fake accounts.

Twitter stocks fell by over 9% on Friday evening following the news, currently valued at a little over $40.

Crypto prices still bearish, BTC over $29,000

The aftermath of last week’s crypto crash can still be felt as crypto markets were bearish in the early hours of Monday morning.

Bitcoin (BTC) was valued over $29,000, down 1.45% and unable to reach previous highs. Ethereum (ETH) was also down 1.59% Monday morning valued at about $2,000.

Last week, the stablecoin Terra (UST) declined by over 80% meanwhile its sister cryptocurrency LUNA lost over 90% of its value.

Ethereum co-founder, Vitalik Buterin, said on Twitter on Friday that Terra should prioritise helping people who made smaller UST deposits in Anchor before aiding the wealthier investors.

Buterin retweet a tweet that read: “​​If Terra just focussed on the ‘poorest’ 99.6% of wallets, then they could make this gigantic group 100% whole.”

“Strongly support this. Coordinated sympathy and relief for the average UST smallholder who got told something dumb about ‘20% interest rates on the US dollar’ by an influencer, personal responsibility and SFYL [or sorry for your loss] for the wealthy,” Butterin added to his retweet.

Note, cryptocurrency CFD trading is restricted in the UK for all retail clients.