Doubts in equity markets amid runaway inflation in the eurozone

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Investors also face another rise in US interest rates this week

European stocks are trying to remain calm after signing their best week in nearly five months. After the gains of the last sessions, caution reigns and the Ibex-35 is trading practically flat, trying to defend the 7,900 points against a few days plagued, again, by macroeconomic references.

In the opening bars of this Monday’s session, the biggest drops were recorded by Inditex (-1.83%), Santander (-1.32%), Repsol (-0.98%), Sacyr (-0.25% ), Red Eléctrica (-0.18%) and BBVA (-0.13%), while Sabadell (+1.68%), Grifols (+1.14%), Amadeus (+0.58%), ArcelorMittal (+0.17%) and Telefonica (+0.04%).

At this point, it was already known that inflation in the eurozone rose to 10.7% in October, a new all-time high that shows that the European Central Bank’s (ECB) battle against price increases will take longer than expected at the end of the year. become power.

A situation that is repeating itself in major economies and that will become clear again this week with the new meeting in which the US Federal Reserve (Fed) will raise interest rates again, expected by an additional 75 basis points.

From Bankinter’s analysis department, they discount that the monetary body’s approach will remain “hawkish” (harsh) in the coming meetings. “First, because inflation shows no signs of reliable easing; secondly because the good behavior of financial assets makes it difficult to pass its monetary policy and thirdly because the US labor market is still in good shape,” they indicate.

In any case, they believe that investors will pay particular attention to the messages that both the Fed and the ECB will launch in the coming months. Something that will be key for the future evolution of the market. “We don’t rule out reviving what happened in the summer after Jackson Hole this week with an upward recalibration of interest rate estimates leading to stock market profit-taking,” they said. A sense of nervousness that could intensify as the November 8 parliamentary elections in the US draw closer.

Meanwhile, on the commodities market, the price of a barrel of Brent, a benchmark in Europe, was trading around $92, while the US West Texas was around $86.

Source: La Verdad

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