Tuesday, December 06, 2022

The rebound in the stock market and the improvement of the position of the pound

The rebound in the stock market and the improvement of the position of the pound

IBEX lost 0.99% in one day after a sneaky rebound in the Spanish stock market yesterday to start Tuesday’s session in which currencies, especially the pound, were the main protagonists. Today, IBEX Futures is up 0.3%.

Europe’s single currency rose 0.3% to $0.9634 today after hitting a 20-year daily low. For its part, the pound corrected after marking a record low of $1.0327 yesterday. Today it is trading at $1.0772.

The Bank of England explained yesterday, in an emergency statement, that the British Monetary Authority has assured it “will not hesitate to change interest rates if it deems necessary.” Last week, the institution’s monetary policy committee raised the value of money by half a point to 2.25%.

“The pound remains subject to extreme volatility. After a loss of close to 9% against the dollar in two days (inflation and mistrust about the development of public debt) that took yesterday morning to a record low of 1,035, A recovery of at least 4% to close at 1.07 on expectations of an emergency rate hike by the Bank of England, which is unlikely at the moment as the BoE simply says it is committed to inflation of 2%”, they Renta Values ​​from 4.

This expectation is made keeping in mind that the next meeting will not take place until November 3 and for which the market is discounting growth of 150 basis points to the level of 4%, while the mid-2023 level of arrivals will be reduced to 6%. increasing to. ,

This greater monetary tightening will serve to offset the fiscal stimulus announced on Friday and may be extended in future. The British government will present a medium-term fiscal strategy to control debt on 23 November.

Today’s macro agenda is limited in Europe, where only the behavior of the monetary aggregate M3, as well as loans given to individuals and companies, will all be published in the month of August, while in the US the agenda is more intense, Starting this afternoon, preliminary data for August for durable goods will be released, along with new home sales for the same month and a consumer confidence index for September, prepared by the conference board.

Juan José Fernández Figueres, director of analysis at LINK Securities, explains that, in theory, this index is one that will attract investors’ attention, as it is a good leading indicator of private consumption, a variable that is very high in US GDP. load in and on which its growth traditionally depends.

Experts point out that, in theory, “a definite improvement in US consumer confidence is expected this month, a correction that will go hand in hand with the downward revision that is beginning to occur in inflation expectations that this group. For reasons we believe there will be a good response from investors.”

Oil and gold are trading with a fall in the commodity market. Gold, which hit a 2-1/2-year low yesterday, rose 0.5% to $1,629 an ounce. Oil has risen slightly from its lowest level since January. US crude rose 0.66% to $77.22 a barrel. Brent crude rose to $84.71 a barrel.

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