Market Update – August 25 – Powell at Jackson Hole, inflation mission not accomplished yet

[ad_1]

US equity markets pulled back strongly yesterday with US30 having its worst day since March, US100 its second worst in August and US500 swinging down $105 from the daily high to the daily low and drawing a big bearish engulfing pattern. The mighty NVDA started trading up 6.50% and ended the day +0.10%; JPN225 leads losses in Asia this morning (-2%). Yields rose and USD strengthened. Markets are cautious before today’s Jerome Powell intervention at the Jackson Hole symposium. The general consensus is that he will try to stay neutral, with no big surprises but a slight tilt to the hawkish side. Nothing similar to last year of course: but the FED does not think its fight against inflation is won yet and the strong economic data give it some room to act. Some energy prices have started to rise again lately – see Oil or Gasoline – but also Rice and Pork Belly are getting extremely expensive: the Cleveland Fed inflation tracker anticipates August’s figures will show a noticeable jump. It’s not time to declare ”mission accomplished” yet.

There has been some chatter about R* lately: this is the neutral interest rate of an economy, a mostly academic concept difficult to calculate and around which, incidentally, Powell developed his first speech in Jackson Hole in 2018. Nick Timiraos is a WSJ journalist who is known to be very close to the FED and in a recent article he brought up the subject of if the long-term neutral rate had not moved up in the US. Just yesterday, the WSJ also published an article wondering whether it was not time for the Fed to move the inflation target towards 3%. Is this perhaps a test of the reaction of the most informed and sophisticated investors? The Fed in June capped the R-Star at 2.5%: who knows if Powell will say anything about that and if there will be any news in September.

We shall see at 14:00 GMT.

• FX – USDIndex > 104 (104.12), EURUSD below its 50MA at 1.0783, GBPUSD 1.2570 (-0.24%), USDJPY 146.06, USDTRY pulling back (26.52) after the big drop yesterday following the hike to 25%.
• Stocks – US100 closed -2.19%, US500 -1.35%, US30 -1.08%; NVDA +0.10%, TSLA – 2.88%, MSFT -2.15%, AAPL -2.62%, META -2.55%, GOOGL -2.09%.
• Commodities – USOil in green for a second day, +0.65% at $79.36, Palladium keeps falling (-0.82% after yesterday’s -2.88%).
• Gold – $1913, XAG -0.35% slightly above $24.

LATER TODAY:  Jerome Powell’s speech at Jackson Hole, German IFO, US Michigan Consumer Sentiment index, ECB’s Lagarde speech. German GDP out at -0.2% y/y.

INTERESTING MOVER: US500 (-1.35% the cash close @ 4376) gave up $105 (or roughly 2.5%) from the intraday high after testing from the downside the 50d MA and drawing a big bearish engulfing pattern.

Click here to access our Economic Calendar

Marco Turatti

Market Analyst

Disclaimer: This material is provided as a general marketing communication for information purposes only and does not constitute an independent investment research. Nothing in this communication contains, or should be considered as containing, an investment advice or an investment recommendation or a solicitation for the purpose of buying or selling of any financial instrument. All information provided is gathered from reputable sources and any information containing an indication of past performance is not a guarantee or reliable indicator of future performance. Users acknowledge that any investment in Leveraged Products is characterized by a certain degree of uncertainty and that any investment of this nature involves a high level of risk for which the users are solely responsible and liable. We assume no liability for any loss arising from any investment made based on the information provided in this communication. This communication must not be reproduced or further distributed without our prior written permission.

[ad_2]

لینک منبع : هوشمند نیوز

آموزش مجازی مدیریت عالی حرفه ای کسب و کار Post DBA + مدرک معتبر قابل ترجمه رسمی با مهر دادگستری و وزارت امور خارجه	آموزش مجازی مدیریت عالی و حرفه ای کسب و کار DBA + مدرک معتبر قابل ترجمه رسمی با مهر دادگستری و وزارت امور خارجه	آموزش مجازی مدیریت کسب و کار MBA + مدرک معتبر قابل ترجمه رسمی با مهر دادگستری و وزارت امور خارجه
مدیریت حرفه ای کافی شاپ	حقوقدان خبره	سرآشپز حرفه ای
آموزش مجازی تعمیرات موبایل	آموزش مجازی ICDL مهارت های رایانه کار درجه یک و دو	آموزش مجازی کارشناس معاملات املاک_ مشاور املاک