Against the backdrop of rather weak data on consumer sentiment in the US, the indices on the New York Stock Exchange fell on Friday, but in the case of the S&P 500 and the Nasdaq remained near the recent record highs reached. For the Dow Jones Industrial, the high reached in May at 35'092 points also remains within reach. On Friday, however, the Dow slipped -0.86% to 34'687.85 points, which means that the index lost half a percent over the week. The S&P 500 fell -0.75% to 4'327.16 points before the weekend and the Nasdaq 100 also posted a daily loss of -0.77%. In Asia, most stock indices at the start of the week followed the negative guidance from overseas, while the Tokyo stock exchange remains closed due to a holiday. The current corporate reporting season could now provide new impetus. This week, the quarterly results of European blue-chip companies are in focus: UBS on Tuesday, Novartis, Daimler and SAP on Wednesday, followed by Roche, ABB or Unilever on Thursday.
Consumer sentiment in the US dampened in July compared to the previous month, contrary to expectations, according to survey results from the University of Michigan. Consumer confidence slipped -4.7 points to 80.8, while analysts on average had expected an improvement to 86.5. At the same time, it was reported that US retail sales rose again in June, but the previous month's figure was worse, according to revised data. Compared to the previous month, retail sales increased by +0.6% in June (consensus -0.4%). On the other hand, however, the initially calculated sales decline for May was revised from -1.3% to -1.7%. Retail sales are also being weighed down by the current global supply difficulties, which are curbing car production, for example, and thus also resulting in fewer car sales. Sales by auto dealers fell by -4.6% in July compared with the previous month.
In the euro area, the rate of consumer price inflation fell slightly on an annual basis. According to Eurostat, consumer prices rose by +1.9% year-on-year in July, compared with +2.0% in June. Once again, the most impressive increase was in energy prices, which rose by +12.6% year-on-year. The core inflation rate also eased from +1.0% to +0.9%.
Like the ECB, the Bank of Japan has now also unveiled a program to combat climate change. On the one hand, the Bank of Japan wants to buy “green bonds” in foreign currency and, on the other hand, to support commercial banks that finance climate-friendly projects with zero interest loans. At the same time, Japan's central bank confirmed its continued expansionary monetary policy, keeping its key interest rate unchanged at minus 0.1% and the target rate for the yield on ten-year government bonds at zero. Furthermore, the Bank of Japan revised its growth forecast for the fiscal year running until next April slightly downward against the backdrop of the pandemic. On the other hand, the BoJ raised its inflation forecast for this year to +0.6% from +0.1% previously.
|10:00||GE||Bundesbank Monthly Report|
|16:00||US||NAHB Housing Market Index (July)||81.0|
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Source: LGT Bank (Switzerland) Ltd.
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