After the Fed took the first step towards normalization in monetary policy by announcing that it would start reducing bond purchases, the eyes were turned to the discussions about the next stage, which is expected to flare up even more in the coming period. Investors' efforts to resolve questions about how much of an increase in inflation can be tolerated and their ability to create jobs led to a cautious course in the global equity markets.
In this process, where the importance of data and verbal guidance on the necessary conditions for interest rate hikes has increased, it was noteworthy that the bank did not evaluate the monetary policy in the speech of Fed Chairman Jerome Powell at the Gender and Economy Conference yesterday. On the other hand, with the statements made by the Fed officials, it was seen that the market started to prepare for the path to be followed in the interest rate hike.
Fed Vice Chairman Richard Clarida said that the bank is far from considering raising interest rates close to zero at present, and that the necessary conditions for an interest rate increase in the inflation and employment market can be met by the end of 2022. st. Louis Fed President James Bullard stated that he expects two rate hikes for the next year, and that faster action may be required if inflation is more persistent than anticipated. Chicago Fed President Charles Evans said he thinks inflation will stay higher in 2022. used the phrase.
On the macroeconomic data side, the Consumer Expectation Survey announced by the Fed's New York Branch yesterday revealed that American consumers' inflation expectations rose to 5.7 percent in a 1-year period, breaking a record.
While these developments were taking place, a limited buying trend was observed in the New York stock market yesterday, with optimism regarding the 1 trillion dollar infrastructure package approved by the US President Joe Biden in the House of Representatives. The Dow Jones index increased by 0.29 percent, the S&P 500 index increased by 0.09 percent and the Nasdaq index increased by 0.07 percent, closing at a record level. The shares of the US electric car manufacturer Tesla, on the other hand, lost nearly 5 percent after the majority of its followers said "yes" to the sale of 10 percent shares, as a result of the survey conducted by the company's Top Manager Elon Musk on Twitter. The US 10-year bond yield is at 1.47 percent today, after rising from 1.45% yesterday and closing over 1.50%. The dollar index, which moved in the narrow band of 93.9-94.4 yesterday, is trying to hold on to the 94 border today. In the index futures contracts of the USA, it is seen that the new day started negative.
According to the data released yesterday on the European side, the investor confidence index in the Eurozone increased for the first time in 4 months and reached 18.3 points in November, amid expectations that supply bottlenecks and high prices are temporary. On the other hand, it was reported that the rising inflation issue was discussed at the Euro Group meeting held yesterday. Making statements regarding the meeting, Eurogroup President and Irish Finance Minister Paschal Donohoe stated that Europe has started to recover economically with vaccination against the new type of coronavirus (Kovid-19) and effective policies, "Although the increase in prices is largely due to temporary factors, this increase is a little bit more than expected. more permanent." he said.
As concerns about gas supply in Europe came to the fore again, futures natural gas contracts again exceeded 80 euros.
With these developments, a fluctuating course was observed in the European stock markets yesterday, while the DAX index in Germany and the FTSE 100 index in the UK decreased by 0.05 percent, and the CAC 40 index in France increased by 0.10 percent. The euro/dollar parity is trading just above 1.16, which analysts describe as resistance, after gaining 0.2 percent yesterday. Index futures contracts in Europe, on the other hand, are following a selling course today.
While it is seen that the new day started with a sales-weighted course on the Asian side, the Nikkei 225 index decreased by 0.7 percent in Japan, the Sensex index in India decreased by 0.2 percent, and the Kospi index in South Korea decreased by 0.2 percent in China. Shanghai composite index, on the other hand, remained flat.
Domestically, the BIST 100 index in Borsa Istanbul, after seeing the highest level in its history with 1,609.07 points yesterday, completed the day with an increase of 1.58 percent at 1,608.54 points, closing the highest of all time. Dollar/TL, on the other hand, is at the level of 9.7020 at the opening of the interbank market today, after closing at 9.6804 with a decrease of 0.2 percent compared to the previous closing level yesterday.
Decisions of the Central Bank of the Republic of Turkey (CBRT) to increase the required reserve ratios for foreign currency liabilities by 200 basis points in all maturity brackets and to reduce the upper limit for the possibility of establishing Turkish lira required reserves in standard gold from 15 percent to 10 percent, Official Gazette. Published in today's issue of
Analysts said that the CBRT's required reserve action will support reserves, and that it is not expected to have a significant impact on the markets.
On the global side, analysts stated that all kinds of data and explanations that can give clues about the path to be followed in interest rate hikes will be determinative on the direction of the markets, and said that in this context, the evaluations of Fed Chairman Jerome Powell, ECB Chairman Christine Lagarde and BoE Chairman Andrew Bailey will be followed today.
Analysts also stated that today the PPI in the USA and the ZEW expectation indices and foreign trade figures in Germany will be monitored, noting that the BIST 100 index is technically at 1.620 level as resistance and 1.570 points as support.
The data to be followed in the markets today are as follows:
10.00 Germany, September foreign trade balance
13.00 Germany, November ZEW expectation index
16.00 Speech by ECB President Lagarde
16.30 US, October PPI
17.00 Fed Chairman Powell's speech
19.00 BoE Chairman Bailey speech
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