Driven by some positively received quarterly reports of listed companies, the Dow Jones Industrial rose on Wednesday by +0.83% to 34'798 points and thus more than made up for the short-lived slump from the beginning of the week. The S&P 500 also climbed +0.82% to 4'358.69 points and on the Nasdaq technology exchange, the indices also posted daily gains of almost +1%. Positive impetus was provided by the ongoing corporate reporting season. Thus, Coca-Cola raised its sales forecast for the full year, as the demand for soft drinks thanks to the reopening of, restaurants, cinemas, theaters, and stadiums again significantly increased. Telecom provider Verizon reported strong subscriber numbers and its quarterly results significantly exceeded market expectations. Johnson & Johnson delivered positive earnings forecast for 2021 and Harley-Davidson posted its second consecutive quarterly profit.
In Asia, the recovery from the setback at the beginning of the week also continued. The broad MSCI index of Asia-Pacific equities outside Japan followed the positive cues from overseas and gained around +1%. Unlike Wall Street, however, most Asian indices are struggling to recoup their losses from the start of the week as Asia faces a rapid spread of the coronavirus delta variant amid a population that is still unvaccinated in many cases. China's regulatory crackdown on technology companies is also causing jitters.
The Tokyo Stock Exchange remained closed today for a holiday. Meanwhile, however, the number of new Covid-19 infections is rising in Japan just before the opening of the Olympics, and with it nervousness. In Tokyo, case numbers reached their highest level since mid-January, driven by the delta variant. Given this development, the Olympic flame is unlikely to ignite the enthusiasm of the Japanese population.
The European Central Bank (ECB) will most likely not communicate any immediate change in its monetary policy today and leave key interest rates at record lows. The pandemic situation and probably also the inflation trend appear too uncertain. However, at the following press conference (2:30pm CET), central bank chief Lagarde could go into more detail on the results of the review of her monetary policy strategy and possibly provide further details on the direction of monetary policy, the "forward guidance". It will also be interesting to see how the ECB assesses the current economic outlook. The tension had been stoked by ECB chief Lagarde herself in an interview with Bloomberg TV, saying “it will be an important meeting and there will be some interesting variations and changes.”
|08:45||FR||Economic Sentiment (July)||107.0|
|13:45||EZ||ECB Monetary Policy Decision||-0.5%|
|14:30||EZ||ECB Press Conference|
|14:30||US||Chicago Fed Activity Index (July)||+0.29|
|14:30||US||Initial Jobless Claims (weekly)||360,000|
|16:00||US||Leading Indicator (June)||+1.3%|
|16:00||US||Existing Home Sales (June, m/m)||-0.9%|
|16:00||EZ||Consumer Confidence (July)||-3.3|
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Source: LGT Bank (Switzerland) Ltd.
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