EUR 100.00 For Business Accounts Only

IBERIAN DAILY 19 SEPTEMBER (ANÁLISIS BANCO SABADELL)

NEWS SUMMARY: LAR ESPAÑA, TELEFÓNICA.

The Fed cut rates by 50bps in the end
It was a transition session with slight corrections for European stock markets that put an end to the Ibex’s rally that led it to return to 2015 highs. Thus, in the STOXX 600 Automobiles and Energy were the only sector avoiding drops, which were led by Media, Food and Consumer Goods. On the macro side, in the euro zone, August’s final monthly inflation was cut by one tenth to 0.1% (with the YoY data unchanged at 2.2%). U. Von der Leyen, president of the EC, announced the restructuring of the commission, incorporating proposals from M. Draghi’s report to boost competitiveness. In the US, the Fed cut rates by -50bps vs. -25bps expected by the consensus, cutting the average rate expected over the 2024-26 period to 4.4%, 3.4% and 2.9 (new long-term level) from 5.1%, 4.1% and 3.1% previously. The decision was not unanimous for the first time since 2005 (Bowman in favour of -25bps) and the growth scenario remained unchanged although with a slight drop in the inflation forecast for 2024-25. On another note, August’s housing starts and building permits climbed above expectations. In Brazil, the Central Bank raised the Selic rate to 10.75%, in line with the consensus expectations.
What we expect for today
Stock markets would open with gains >+1.0%, with the good performance of cyclical and growth sectors. Currently, S&P futures are up +0.91% (the S&P 500 ended -0.11% lower vs. the European closing bell). Asian markets are climbing (China’s CSI +0.81% and Japan’s Nikkei +2.56%).
Today in the UK BoE meeting. In the US we will learn September’s Philadelphia Fed index, August’s existing home sales and weekly jobless claims.