Macroeconomic/ geopolitical developments
- Anticipation of interest rate cuts by the Federal Reserve and the European Central Bank fueled a rally in global stock markets, with major U.S. indexes and European stocks climbing, while bond yields fell due to revised US job growth figures and easing expectations.
- Fed Chair Jerome Powell’s dovish remarks at the Jackson Hole Symposium and the latest FOMC meeting minutes suggest imminent interest rate cuts, signaling a shift towards easing monetary policy to sustain economic growth and achieve a “soft landing.”
- The downward revision of U.S. payroll data by 818,000 jobs led to a decline in bond yields and a rise in stocks, as markets anticipated potential Federal Reserve rate cuts to support a cooling economy.
- Investors are closely watching Nvidia’s upcoming earnings report Wednesday and the US PCE inflation data Friday, as both could significantly impact market sentiment with the latter influencing the Federal Reserve’s interest rate decision.
Global financial market developments
- US and global equity averages extended higher.
- US and European bonds moved to lower yields.
- The US Dollar Index pushed notably lower to its lowest point since 2022.
- Gold futures rallied, to a record high.
- Oil futures sold off and rebounded from near a multi-month low.
Key this week
Central Bank Watch: No significant central bank activity this week, but Fed speakers will be key as always.
Macro Data Watch: The main macro data release this week is the US PCE data on Thursday and Friday, with Friday’s data key. Some other releases of note are the US Consumer Confidence Tuesday, GDP on Thursday, Japanese, German and EU Unemployment Reports on Friday and EU CPI on Friday.
Earnings Watch: Nvidia is set to release its fiscal second-quarter earnings on Wednesday.
| Date | Major Macro Data |
| 08/26/2024 | UK Bank Holiday; German IFO; US Durable Goods Orders |
| 08/27/2024 | German GfK Consumer Confidence Survey and GDP; US Consumer Confidence |
| 08/28/2024 | Nothing of note |
| 08/29/2024 | EU Consumer Confidence; German CPI; US GDP, PCE (QoQ) |
| 08/30/2024 | Japanese CPI, Unemployment Report; German Retail Sales, Unemployment Report; EU CPI, Unemployment Report; Canadian GDP; US PCE (YoY, MoM); Michigan Consumer Sentiment Index; Chicago Purchasing Managers’ Index |
