Milan – Central banks are back in the spotlight for investors, Coming back from a week of correction, there are doubts The real impact of massive investments in AI and some weaker-than-expected quarterly results led to selling of securities at high levels in many cases.
The focus now shifts to decisions that governors in Japan, the United States (Wednesday) and the United Kingdom (Thursday) will announce this week.
In the first case, the governor Kazuo Ueda It is elusive, but after a period of substantial weakness, the market recently priced in a sharp rise in the yen on expectations of monetary tightening (with the outlook ranging from 40% to 90% according to market forecasts) after the latest economic data showed an acceleration in growth. Inflation. Next we turn to the President’s speech Jerome Powell Look for a clear timing for the first Fed rate cut in September. On the other hand, traders are betting on at least two quarter-point cuts in 2024, leaving little room for intervention at the moment. James Knightley, chief international economist at ING, told Bloomberg that the meeting “will lay the groundwork for a rate cut in September as the Fed will articulate its rationale for shifting policy from restrictive territory to a more neutral basis.” In addition, Key report on U.S. jobs due on Friday.
Finally, the Bank of England Andrew Bailey: The market has not yet decided whether to price in the first rate cut since the pandemic (currently at 5.25%). Headline inflation has fallen and the labor market is showing signs of weakness; but it is also true that inflation in the services sector and wage increases are continuing.
Appointments are circled in red, while signs of reopening in futures markets from Asia to the West are positive. It is in full swing on both sides of the Atlantic as the quarter continues. In the US, it is mainly tech giants Microsoft (earnings on Tuesday), Meta (Wednesday), Apple and Amazon (Thursday), but McDonald’s quarterly report is also coming soon.
Asian markets took advantage of Wall Street’s positiv
Major European stock markets opened higher. In the first minute of trading, Piazza Affari rose 0.70% to 34,047 points, Frankfurt rose 0.61%, London rose 0.52%, and Paris rose 0.35%. In the Asian market, Tokyo’s Nikkei 225 index rose 2.29% to 38,516 points.
Asian markets took advantage of Wall Street’s positive momentum on Friday.
Asian markets are recovering following a surge on Wall Street after U.S. inflation slowed further in June, sparking hopes of a rate cut by the Federal Reserve. Tokyo rose two percent after eight straight days of losses, while Hong Kong, Sydney, Seoul, Singapore, Taipei and Manila gained. The Bank of Japan is also due to make an announcement on Wednesday, amid speculation the central bank will raise interest rates again after it made its first rate hike in 17 years in March and abandoned its ultra-flexible policy. Expectations of a rate hike at this week or the next Bank of Japan meeting, as well as bets on a rate cut by the Federal Reserve, have pushed the yen higher after hitting a four-year low of 162 per dollar earlier this month.
Wall Street’s rebound will continue
The Federal Reserve will hold a two-day meeting, which will be the first weekly trading day on Wall Street, and is expected to hold the federal funds rate steady at 5.25%-5.50% for the eighth consecutive meeting. If there is any sign of a September plan, a rate cut is considered a given. Dow Jones futures rose 0.38%, S&P 500 futures rose 0.48%, while Nasdaq futures rose 0.65%
At the beginning of this week, futures prices on major European stock exchanges rose, with the most anticipated data in Europe being GDP and inflation data from major economies such as the Eurozone, Germany, France, Italy and Spain. Eurozone GDP is expected to grow by 0.3% in the second quarter, the same as in the first quarter. Frankfurt DAX futures rose 0.39%, London DAX futures rose 0.06%, and Paris DAX futures rose 0.18%.