After warning on emerging market currencies last week against Dollar, in where Deutsche bank, world’s second biggest currency trader has warned that Dollar, still got juice left to push to upside as FED becomes more hawkish, against all emerging market currencies and Euro but Japanese Yen.

Now this week, it has warned against upside in European equities as they feel they are all juiced out. It has reduced its forecast for pan European Stock index, EuroStxx600 to 325, compared to previous forecast of 380.

Deutsche has cited, weak global growth, risk of faster hikes from U.S. Federal Reserve, fading in China’s rebound and fragilities in U.S. high-yield credit market as the reasons behind its change in forecast. The bank estimates that with 1% rise in high-yield debt market is leading to around 4.5% drop in pan-European equities.

Our expectations, at FxWirePro is similar to Deutsche, however we expect there could be some rise in  the short term in pan European blue chip index, Eurostxx 50. However, in the longer horizon we expect the index to decline by half, due to risks from China.

EuroStxx50 is currently trading at 2960 and EuroStxx600 at 335.

The material has been provided by InstaForex Company –