Following Tuesday’s sell-off – prompted by fears over the India covid-19 variant and exacerbated by the multi-month and all-time highs the markets had found themselves at – Europe rebounded after the bell on Wednesday.
Though it wouldn’t have been a shock to see a UK CPI reading of 0.7% cause further losses, especially compared to the 0.4% posted the month prior, the fact it fell short of the 0.8% forecast helped nip any inflationary pressure panic in the bud.
Instead, the FTSE rose 0.8%, pushing back above 6,900 after shrinking to a 2-week low on Tuesday evening.
The DAX underwent a similar, if slower, recovery, climbing half a percent to sit a few points short of 15,200. The CAC, meanwhile, was up 0.6% and at 6,140.
After a 255-point plunge left it the wrong side of 34,000 on Tuesday night – it’s a sign of how girthy the index now is that such a decline only translated to a 0.75% drop – the Dow Jones looks unwilling to get back on the horse.
Unlike the rebounding European indices, the Dow is facing a 0.1% increase this afternoon, a move that would only just put it back at 33,850.
Hanging over the markets is the question of the India Covid variant, or variants. The travel-related concerns, and subsequent heavy losses, sparked on Tuesday are still there. Investors are just choosing to ignore them, something that could easily change before the day is over.
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