Home » Stock exchanges, Europe at stake after Powell’s reassurances. Oil runs

Stock exchanges, Europe at stake after Powell’s reassurances. Oil runs

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European equity markets do not seem oriented to follow the example of Wall Street and the Asian markets: despite the assurances of the Fed’s number one Jerome Powell on the probable temporary nature of the price flare, the main indices of the Old Continent are moving in negative territory. After a cautious start, the indices slowed further after the release of the Pmi indices, however positive, relating to manufacturing and services in June. In “red” the FTSE MIB in Milan, in particular with Moncler and Saipem. Meanwhile, the dollar returns to weaken after the flare-up of the last few sessions, while oil is running, with Brent updating its highs since autumn 2018.

The Eurozone economy is growing at the fastest rate in 15 years

In June, as the economy continued to reopen from anti-Covid-19 restrictions and optimism fueled by the advancement of the vaccination campaign, eurozone activity indicated the fastest expansion in the past 15 years. From the reading of the preliminary flash data, in fact, the composite Markit SME index of the eurozone in June rose to 59.2 from 57.1 in May, marking the highest value since June 2006. It is the third consecutive monthly acceleration of production growth, due to an economy that is continuing the process of reopening from the anti Covid-19 restrictions. Demand improved further, signaling the fastest acceleration in new order growth since June 2006.

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FTSE Mib stock market trend

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The economic recovery remains in the spotlight

The American recovery is proceeding quickly and the labor market will soon accelerate as well. Jerome Powell in front of Congress paints a rosy and reassuring picture on the inflation front. But warns: the pandemic continues to pose risks to the economic outlook. «In the autumn the normalization of the American labor market should accelerate with the reopening in the presence of schools and the expiry of extraordinary unemployment benefits “, says Luigi Nardella of Ceresio Investors.” The Fed could therefore communicate the beginning of ‘tapering’ at the end of the year or at the beginning of the of the next. The ECB will follow. Financial markets will remain vulnerable due to extremely compressed bond yields and high equity valuations. The task of the Fed, and of the main central banks, in the coming months will not be easy, ”he adds.

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Well the banks, buy on Stellantis

In Piazza Affari, bankers are doing well, with Banco Bpmben bought, together with Unicredit. Purchases also reward Stellantis. Davide Campari is doing well, taking advantage of the improvement of the 2020-21 guidance by the French competitor Pernod Ricard, which in Paris earns almost 4%. A heavy rebound for Italian Exhibition Group after the words of the mayor of Bologna on the lengthening of the times for the aggregation with Bologna Fiere.Aim Italia leap for the jewelry company Gismondi 1754 which has announced an exclusive distribution agreement to expand in the UK. Sale Enertronica Santerno thanks to a 2.5 million contract for the supply of inverters.

The dollar folds, the euro returns above 1.19. Oil in rally

The US dollar returns to weaken, with the euro recovering and exceeding the 1.19 threshold while oil regains momentum: Brent, which had marked the highest levels since autumn 2018, above $ 75 already yesterday, rises further in the delivery August, while the Wti August updates the top from September 2018 over 73 dollars. The American Petroleum Institute report, which estimates a sharp drop in inventories, is pushing crude oil prices, awaiting official data on US inventories.

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