Selective picks up Wall Street bearish witness and loses 1% over future of US monetary policy doubts
European stock markets are picking up the bearish witness of Wall Street collapsing Wednesday after the press conference of Fed President Jerome Powell after the meeting in which the body decided to raise interest rates by another 75 basis points, up to a range of 3.75%-4%.
The Ibex-35 is yielding 1% in the early trading stages, moving away from 8,000 points, while the rest of European stock markets register similar declines.
Far from his usual position of transparency and clarity in his speeches, investors believe that Powell left in the air many doubts about the future of monetary policy yesterday. As explained by Carlos del Campo, a member of Diaphanum’s Investment Department, the Fed president stressed that it is still early days to pause rate hikes. But on the other hand, he assured that the next meetings will take into account the “accumulated effort of increases and their delayed effect on the economy, which could cause a 50 basis point increase and not 75 basis points” at the December meeting. . account.
However, Powell also explained in his speech that final interest rates (as the maximum peak interest rates are expected to reach is known) could be higher than initially estimated, closer to 5% than the 4.6% announced in September. And this is what the market liked least, triggering sell orders, leading to sharp declines on Wall Street that exceeded 3% in the Nasdaq technology index.
Next Thursday, another central bank, England’s, is expected to announce another hike in its benchmark interest rates by 75 basis points to 3%, following in the Fed’s footsteps. The BoE is also the only one you have started the process of reducing your balance.
Against this backdrop, Link Securities analysts expect a bearish session in European equity markets, fueled by the declines in Asia following Chinese health authorities’ denial of a possible strategy change in their fight against the pandemic. “The high level of overbought that many securities are in is likely to encourage some investors to take profits, especially early in the day, although we cannot rule out the possibility that, as the session progresses, European stock markets will moderate their declines,” indicate them in your daily review.
Meanwhile, the oil price in the commodities market fell by almost 1%, with a barrel of Brent, a benchmark in Europe, trading at $95, while West Texas in the US is around $89.
Source: La Verdad
I’m Wayne Wickman, a professional journalist and author for Today Times Live. My specialty is covering global news and current events, offering readers a unique perspective on the world’s most pressing issues. I’m passionate about storytelling and helping people stay informed on the goings-on of our planet.
