On Europe's stock markets, the ECB's interest rate decision was well received and the EuroStoxx 50 closed with a daily gain of +0.31% at 4,233.87 points. Thus, the European benchmark index approached the high reached in September since 2008.
On Wall Street, quarterly reports remained in focus. On the Nasdaq, the indices again recorded record values. The Dow Jones Industrial gained +0.68% from the previous day to 35'730.48 points and the market-wide S&P 500 exited the day's trading almost one percent higher at 4'596.42 points. The Nasdaq 100 gained for the fourth day in a row, gaining +1.15% on Thursday to close at 15'778.16 points. Facebook caused attention with the renaming of the group in “Meta”. Shares of Apple fell by about -5% after the close as the iPhone manufacturer missed the market's revenue forecasts in the fourth fiscal quarter with lower than expected iPhone sales. Apple also warned of challenges due to supply chain disruptions.
“We expect inflation to continue to rise in the near term, but then to come down over the next year,” central bank chief Christine Lagarde said. She thus reaffirmed the previous assessment that the increased inflationary pressure will only be of a temporary nature. In September, the inflation rate in the euro zone reached +3.4%, the highest level in 13 years. At the same time, ECB President Lagarde expects the euro economy to continue to recover strongly, even if momentum has slowed somewhat due to shortages of materials, equipment, and labor. However, further recovery would continue to depend on the course of the pandemic and further progress with vaccinations. Overall, the ECB describes the risks to the economic outlook in the eurozone as “broadly balanced.”
In October, the EU Commission's Economic Sentiment Indicator (ESI) again signaled an improvement in general economic sentiment in the eurozone. The indicator climbed by 0.8 points to 118.6 in the current reporting month. Analysts, however, had expected a decline to 116.7 points. Sentiment in the service sector brightened particularly significantly.
In Spain, the cost of living rose by +5.5% on an annual basis in October, the strongest increase in the inflation rate since 1992. Unsurprisingly, this was due to higher energy prices.
Yesterday, the Bank of Japan presented its latest forecasts for economic growth and inflation at its monetary policy assessment. Against the backdrop of problems in global supply chains, the BoJ is now forecasting GDP growth of +3.4% in the current fiscal year (to the end of March 2022) (previously +3.8%). On the other hand, the central bank revised its projection for 2022/23 upward from +2.7% to +2.9%. In its inflation outlook, the BoJ now expects core consumer prices to stagnate in the current fiscal year (previously +0.6%) and to rise by +0.9% (unchanged) in the following year. This is still well below the central bank's long-term inflation target of two percent.
The 26th United Nations Climate Summit begins in Glasgow on Sunday. There are calls for countries to tighten up their climate targets and make them more concrete. However, it remains to be seen whether concrete implementation steps can be agreed - especially in view of the acute energy crisis in many countries. Stronger climate protection efforts could above all support shares of companies with a focus on renewable energies.
|07:30||FR||GDP Q3 (q/q)||+1.1%|
|08:00||GE||Import Prices (September, y/y)||+16.5%|
|08:45||FR||Consumer Prices (October, y/y)||+2.7%|
|09:00||SZ||KOF Economic Indicator (October)||110.6|
|09:00||SP||GDP Q3 (q/q)||+1.1%|
|09:00||AUT||GDP Q3 (q/q)||+3.6%|
|10:00||GE||GDP Q3 (q/q)||+1.6%|
|11:00||EZ||GDP Q3 (q/q)||+2.2%|
|11:00||EZ||Consumer Prices (October, y/y)||+3.4%|
|11:00||EZ||Core Consumer Prices (October, y/y)||+1.9%|
|11:00||IT||Consumer Prices (October, y/y)||+2.9%|
|14:30||US||Consumer Spending (September, m/m)||+0.8%|
|15:45||US||Chicago PMI Manufacturing (October)||64.7|
|16:00||US||Consumer Confidence Michigan (October)||71.4|
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Editor: Alessandro Fezzi, +41 44 250 78 59, E-Mail: firstname.lastname@example.org
Source: LGT Bank (Switzerland) Ltd.
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