On the New York Stock Exchange, the Dow Jones Industrial closed virtually unchanged on Monday at 36'087.45 points (-0.04%) and also the S&P 500 didn't move and went out of the day's business at 4'682.80 points (+0.01%). Approximately the same picture was seen on the technology exchange Nasdaq. The American stock markets were thus unable to benefit from the positive guidance from Europe and Asia. This morning, Asian equity markets trended without a clear trend, waiting for new guidance.
US President Joe Biden and China's State and Party leader Xi Jinping stressed the importance of cooperation during an online conversation and sought to defuse some of the apparent tensions. Both sides stressed that good relations are important to advance development in both countries, ensure a peaceful and stable international environment, and find effective responses to global challenges such as climate change and the corona pandemic. It is the responsibility of both countries to ensure that competition between countries does not degenerate into conflict, whether intended or unintended, and all countries must play by the same rules, Biden said.
According to the latest survey results from the New York Federal Reserve, sentiment in the regional industrial sector around metropolitan New York improved more than expected in November. The resulting Empire State index climbed by 11.1 points to +30.9 points compared with the previous month. Economists had expected a much smaller increase to +22.0 points. The indicator thus signals robust economic growth in the regional sector and is considered a reliable indication for the national ISM manufacturing PMI.
The European Central Bank (ECB) is likely to remain in a “wait and see” mode with regard to its monetary policy. This can be inferred from yesterday's statements by central bank president Christine Lagarde. It is very unlikely that the conditions for an interest rate hike next year will be met, Lagarde told the European Parliament. The background to this is that the ECB still expects inflationary pressures to weaken next year – even if the slowdown will be slower than originally expected. The ECB justifies this by what it sees as only a temporary rise in energy prices and supply bottlenecks. At present, Lagarde said the ECB also does not see a major risk that rising wages could lead to a sustained rise in inflation. “Overall, we continue to expect inflation to remain below our new symmetric two percent target over the medium term,” the ECB president said in Brussels. With the Federal Reserve (Fed) having already announced the throttling of its quantitative measures, or tapering, and several central banks, such as Australia's RBA, having already tightened interest rates, or in the case of the Bank of England about to do so, the pressure on the ECB is likely to increase.
The head of the British central bank, Andrew Bailey, emphasized that he was very concerned about the inflation outlook. Against this backdrop, the last decision of the Monetary Policy Council on November 4 not to raise key interest rates yet was extremely tight, according to Bailey. The financial markets currently expect an almost 100% probability that the Bank of England will raise interest rates by 15 basis points to +0.25% on December 16.
|08:00||UK||Unemployment Rate (September)||4.5%|
|08:45||FR||Consumer Prices (October, y/y)||+3.2%|
|09:30||NL||GDP Q3 (q/q)||+3.8%|
|10:00||IT||Consumer Prices (October, y/y)||+3.1%|
|11:00||EZ||GDP Q3 (q/q)||+2.2%|
|14:30||US||Retail Sales (October, m/m)||+0.7%|
|15:15||US||Industrial Production (October, m/m)||-1.3%|
|16:00||US||NAHB Real Estate Index (November)||+80.0|
|17:00||EZ||ECB President Lagarde|
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Source: LGT Bank (Switzerland) Ltd.
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