Global stocks climbed in Wall Street and the dollar fell on Monday, after rising last week on expectations that the U.S. economy would avoid a recession and cooling inflation would prompt further interest rate cuts.
In Wall Streetshares added to recent gains, after the Industrial Average Dow Jones rose 0.58% to 40,896, and the S&P 500 gained 0.97% to 5,608. For its part, the Nasdaq Composite gained 1.39% to 17,876, and the MSCI index The broader global stock market rose about 1%.
The prospect of lower borrowing costs could not sustain the record highs of the gold and the dollar fell in front of the eurowhile the yen was appreciated.
In the United States, members of the Federal Reserve (Fed), Mary Daly and Austan Goolsbee, were over the weekend pointing out the possibility of a Flexibility in September, while the minutes of the latest monetary policy meeting to be published this week should underline the dovish outlook.
In Europehe STOXX rose about 0.6%, hitting a more than three-week high on broad market gains, while the index Blue-chip FTSE 100 climbed 0.55%. Earlier, the index Nikkei N225 closed down 1.77% at 37,388.62, breaking a five-day winning streak that had boosted it 8.7% last week.
Waiting for Powell’s speech
The president of the Federal Reserve, Jerome Powell, The Fed will speak in Jackson Hole on Friday and investors assume he will acknowledge the need for a cut. “All signs point to that happening on Friday. We’ll be watching for any indication that rate cuts are coming. The next question is, how big will those cuts be?” said Paul O’Neill, chief investment officer at the wealth management firm Bentley Reid.
Futures are fully priced for a quarter-point move and imply a 25% chance of 50 basis points, depending heavily on what the next payrolls report shows.
Meanwhile, analysts at Goldman Sachs lowered their expectations of recession in USA to 20% and could reduce them further if the August jobs report, due in September, “looks reasonably good,” a note said Friday.
Source: Ambito
