It was a quiet day on the economic calendar. Prelim December inflation figures for Spain were in focus in the early part of the day.
Deflationary pressures eased in December. The Harmonized Index of Consumer Prices fell by 0.6%, year-on-year, in December, following a 0.8% decline in November. Economists had forecast a 0.7% decline.
Consumer prices fell by 0.5%, year-on-year, following a 0.8% decline in November.
From the U.S
It was a busier day on the economic data front. Goods trade data, pending home sales, and Chicago PMI figures were in focus late in the session.
In November, the goods trade deficit widened from $80.42bn to $84.82bn, with pending home sales sliding by 2.6%. In October, pending home sales had fallen by 0.9%.
On the positive, however, was a rise in Chicago’s PMI from 58.2 to 59.5. Economists had forecast a decline to 57.0.
The Market Movers
For the DAX: It was a mixed day for the auto sector on Wednesday. Volkswagen rose by 0.57% to buck the trend on the day. BMW fell by 0.81% to lead the way down, however, with Continental and Daimler seeing losses of 0.33% and 0.28% respectively.
It was also a mixed day for the banks. Deutsche Bank rose by 0.24%, while Commerzbank fell by 0.27% on the day.
From the CAC, it was a bearish day for the banks. Credit Agricole fell by 0.86%, with BNP Paribas and Soc Gen ending the day down by 0.78% and by 0.57% respectively.
It was also a bearish day for the French auto sector. Peugeot and Renault fell by 0.22% and by 0.86% respectively.
Air France-KLM fell by 1.68%, with Airbus SE ending the day with a 1.96% loss.
On the VIX Index
It was back into the red for the VIX on Wednesday, following 2 consecutive days in the green. The VIX fell by 1.34% on the day, partially reversing a 6.36% gain from Tuesday, to end the day at 22.77.
The Dow and the NASDAQ rose by 0.24% and by 0.15% respectively, with the S&P500 gaining 0.13% gain.
Positive sentiment towards an economic recovery delivered support for the majors as the year nears its end.
FED support, government stimulus, and COVID-19 vaccinations continued to drive market optimism for 2021. The upside on the day came in spite of rising COVID-19 cases and the new and more virulent strain of the virus.