LIVE MARKETS-German vote might keep Europe profit taking at bay

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GERMAN VOTE MIGHT KEEP EUROPE PROFIT TAKING AT BAY

After a surprisingly strong start to the year, Citi believes European stocks are vulnerable to "pronounced" profit taking risks, but the lack of nasty surprises in Sunday's German elections might mean time for that is still not quite right.

"With the German election coming in largely as expected, this will possibly keep profit takers at bay in the short-term," says Citi, pointing specifically to the heavyweight German DAX .GDAXI and the Euro STOXX 50 .STOXX50 blue chip benchmark.

According to the US bank's latest weekly look at positioning across futures markets, bullish levels and long profits are still elevated for most European indexes, excluding the UK.

Citi believes this temporary lull will hold until more details emerge on whether the election outcome translates into a more favourable economic backdrop for Germany and the euro zone.

(Danilo Masoni)

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