In Asian equities, the euphoria of recent days – witnessed by two consecutive days of rally on the Hong Kong stock exchange – gives way to greater caution: an element that unites world stock exchanges, pending this week’s market mover event ( and even the next): the speech by Jerome Powell, number one of the Federal Reserve, at the Jackson Hole symposium.
The Tokyo stock exchange was flat, with the Nikkei 225 index closing the session with a change of -0.03% at 27,724.80 points. Seoul Stock Exchange + 0.27%, better the Shanghai Composite, up by 0.65%, Sidney + 0.40%, while Hong Kong’s Hang Seng currently drops 0.40% after jumping more 2% on the eve.
Powell will speak on Friday 27 August at 4.00 pm Italian time, at the Jackson Hole symposium, an annual event awaited with trepidation by the international financial community, often the scene or forerunner of big announcements by the Fed.
In the last few hours, the feeling is prevailing among operators that Powell will hardly indicate on this occasion a timetable for the reduction of monetary support from the Fed, and in particular the reduction of asset purchases (the so-called tapering), which take place for a worth $ 120 billion per month.
Markets will literally hang on Powell’s lips, hoping for more precise indications as to when the dreaded QE tapering announcement might come.
Edward Moya, senior market analyst at Oanda, commented that “the Fed may also make an announcement on tapering in September or November, but tapering will likely go slow, with no commitment to raising interest rates.” .
Powell’s speech will be titled “The Economic Outlook”.
In a note reported a few days ago by CNBC, Nomura economist Aichi Amemiya stressed that, “given the recent deterioration of (macro) data and the pandemic situation, we see the risk that Powell will focus on increasing uncertainty, due to the recent increase in Covid-19 infections “.
Consequently, “at the very least – reads Amemiya’s note – we believe that the recent comments from Fed officials support our view of a tapering announcement in December, despite the fact that the FOMC would prefer November, according to what emerged from the July meeting “.
The wait is therefore for a Fed that will be less hawkish than feared.
Among the Asian stock exchanges, the Mumbai stock exchange stood out today, in particular the reference index Sensex, which tested an absolute record around 56,118 points, in the first hours of trading, and then continued little movement.
The euphoria that has invested in the Hang Seng index of the Hong Kong stock exchange in recent days is dampened: after the rallies, which in some cases were double-digit for some stocks, Tencent (+ 0.85%), Meituan ( + 2.80%), and JD.com (+ 4.6%) however continue to remain solid.
Instead, it retraces Alibaba.
Just yesterday, the Beijing cybersecurity authority issued new provisions to Chinese companies wishing to go public, including those that intend to launch IPOs on foreign exchanges.
On Wall Street yesterday, the Dow Jones Industrial Average rose 30.55 points, less than 0.1%, to 35,366.26 points. The S&P 500 advanced 0.1% to the new closing high of 4,486.23 points. The Nasdaq Composite gained 0.5% to 15,019.80, also testing a new close record.