USO - Far Right Surges In Europe Adding To Geopolitical Risk | Benzinga
To gain an edge, this is what you need to know today.
Added Geopolitical Risk
Please click here for an enlarged chart of iShares MSCI France ETF (ARCA: EWQ).
Note the following:
- The chart shows French stocks made a lower high.
- The chart shows French stocks are making a topping formation. This is a negative.
- Investors already face significant geopolitical risks emanating from Ukraine, Taiwan, Korea, and the Middle East. Now there is an additional risk – far right parties may win a record number of seats in the European Parliament.
- According to the exit polls, far right parties will win 150 of 720 seats.
- Centrists are still likely to win the largest number of seats, but both the far left and far right are gaining seats.
- Of note is that the biggest far right gains are coming from three important countries: France, Italy, and Germany.
- In France, President Emmanuel Macron dissolved parliament and called a snap election. Marine Le Pen’s far right National Rally won 36.8% of the vote compared to Macron’s party winning 14.6% of the vote.
- In Germany, Chancellor Olaf Scholz’s Social Democrats won only 14% of the vote.
- In The Arora Report analysis, it is likely that voters who voted for the far right parties in the European election may end up voting for centrist parties in national elections.
- In The Arora Report analysis, investors should also note that the pro-environment Green parties suffered heavy losses in the election. It appears that voters in Europe are tired of the heavy cost of ambitious climate policies. This has a negative impact on electric vehicle stocks and renewable energy stocks.
- The election results from Europe are dampening the sentiment across the globe. On the positive side, three developments are helping the stock market.
- There was a significant pump over the weekend about AI stocks. Retail investors tend to respond to the weekend pump.
- Retail investors are excited about NVIDIA Corp (NASDAQ: NVDA) trading post split at about $120.
- Apple Inc (NASDAQ: