European stock market indices and US index futures erased part of today's gains over the past hour. Earlier, gains were reasoned with lower than expected CPI readings for December from German states but it was driven mostly by one-off factors related to gas payments. Reading for the whole Germany will be released at 1:00 pm GMT today and, given surprises in state readings, may show a downside surprise. Such an outcome could be positive for indices as it would give ECB more room to be flexible when it comes to policy tightening. On the other hand, it should be noted that state reading have not shown a similar deceleration in core inflation as it either ticked slightly lower or stayed unchanged.
US30
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US30 dropped around 0.6% from a daily higher but still continues to trade 0.4% higher on the day. A potential trend line, marked with recent local lows, is being tested right now. Source: xStation5
DE30
DE30 continues to trade around 1% higher but trades 0.8% off daily high. DE30 trades slightly above a key support zone in the 14,200 pts area. Apart from lower headline inflation figures from Germany, indices in Europe are also supported by steep drop in gas price which now trade near €75/MWh. On the other hand, should core German inflation surprise to the upside, indices may start to struggle. Source: xStation5
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