Last week, concerns about global economic growth and trade wars were the most important dynamics affecting markets, with Wall Street dominating sales. Although Trump’s tweet to postpone additional tariffs that it plans to implement and strong retail sales data in the US boosted morale, it didn’t stop the indices closing down at the end of the week.
Euro / USD parity closed the last week with a loss of close to 1% due to the strong dollar and weak German data. Weak economic data from Germany and China triggered recession concerns. In fact, the weak economic data in this environment, the central banks will push the expansionist policies, although they are welcomed by investors, the return of the yield curve with the return of recession concerns led to sales with weak data.
LME copper closed the week with a 0.21% loss from $ 5755, down to $ 5709 due to weak Chinese data and recession concerns.
In the first trading day of the new week, risk appetite was observed in the markets. At the weekend, the Central Bank of China announced that the interest rate reform was aimed at lowering borrowing costs for companies, as well as the German finance minister’s statement that the government could spend 50 billion euros in a possible economic crisis and that the sanctions imposed on Huawei in the US were postponed. .
Expectations that the economy will be supported and risky assets gained value as demand turned to them from secure ports such as bonds and gold.
3 major indices in the USA closed the day with 0.96% – 1.35% premiums. Dax, FTSE 100 and CAC40 were closed with premiums above 1%. Asian stock markets closed today horizontally / minus after yesterday’s sharp gains as support expectations in major economies alleviated concerns about the global recession. Within the scope of the changes made by the Bank of China in determining the interest rate mechanism, the first basic credit rate (LPR) was slightly lower than the previously announced level, which suppressed the Chinese indices.
The markets’ attention will be on the minutes of the Fed’s latest meeting on Wednesday. The markets are also expected to face Fed’s Jackson Hole meeting and G7 summit (August 24-26) this week for clues to market makers’ new steps to stimulate growth.
The Washington Post reported that senior White House officials are assessing a temporary reduction in salary tax to boost the economy. “Fed interest should be reduced by at least 100 basis points in a very short period of time, and perhaps some monetary easing should go,” Trump said on Twitter.
After closing the dollar index with a premium of 0.2% yesterday, it is still at 98.395 level; The euro is flat against the Dollar at 1.1080.
Supported by PBOC’s step to help reduce borrowing costs, LME copper rose to $ 5819 yesterday, closing the day at $ 5769 with a 0.25% premium.
Today, LME copper continues to be traded at the $ 5725 level, which has declined due to increasing concerns about demand in China.
Today, Home Depot will announce its balance sheet. The rest of the week will be focused on second-hand home sales, Markit manufacturing and service PMI data, new home sales and FED meeting minutes, and Powell’s Jackson Hole speech on Friday.