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Europe’s Thinnest Market In 18 Years Sends Ominous Signal

Summary:
While US investors are fighting each other off to buy stocks (well FANG stocks), Chinese and European equity markets have suffered in recent months amid growth concerns and trade war fears. One might not know it looking at the Euro Stoxx 50 Volatility Index hovering just barely in the double digits... But, as Bloomberg's Benjamin Dow notes, larger prices swings could be coming to European stocks this month as volumes dry up. Even by August standards, it's unusually quiet. The last time Stoxx 600 volumes' 15-DMA for this particular day was lower was in 2000: It could be an ominous sign for those who are betting on a quiet end to the month, amid numerous macro stormclouds like Sino-U.S. trade jabs, U.S. politics (sanctions and mid-term elections), Italy-EU budget battles, and

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While US investors are fighting each other off to buy stocks (well FANG stocks), Chinese and European equity markets have suffered in recent months amid growth concerns and trade war fears.

Europe's Thinnest Market In 18 Years Sends Ominous Signal

One might not know it looking at the Euro Stoxx 50 Volatility Index hovering just barely in the double digits...

Europe's Thinnest Market In 18 Years Sends Ominous Signal

But, as Bloomberg's Benjamin Dow notes, larger prices swings could be coming to European stocks this month as volumes dry up.

Even by August standards, it's unusually quiet. The last time Stoxx 600 volumes' 15-DMA for this particular day was lower was in 2000:

Europe's Thinnest Market In 18 Years Sends Ominous Signal

It could be an ominous sign for those who are betting on a quiet end to the month, amid numerous macro stormclouds like Sino-U.S. trade jabs, U.S. politics (sanctions and mid-term elections), Italy-EU budget battles, and Brexit.

Europe's Thinnest Market In 18 Years Sends Ominous Signal

As Dow warns, an anomalously busy start to the month in terms of macro newsflow combined with low volumes could well set the stage for fireworks.

Tyler Durden
Tyler Durden (a pseudonym) represents the idea that a return to truly efficient markets is a possibility and a necessity. After having experienced the inner workings of capitalism at various asset managers and advisors, Tyler believes that the current model is flawed and a deleveraging at every level of modern society is needed to reinspire the fundamental entrepreneurial spirit.

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