EUR 100.00 For Business Accounts Only

IBERIAN DAILY 22 SEPTEMBER (ANÁLISIS BANCO SABADELL)

NEWS SUMMARY: ACS, TALGO.

The Fed drags down stock markets to negative territory
Despite the Fed’s pause in raising interest rates, its hawkish message led to new and strong debt widening. Thus, in the STOXX 600, almost all the sectors ended in the red, with the exception of Retail and Banks, that closed flat whereas Basic Resources and Chemicals saw the biggest drops (>-2.0%). On the macro side, in the euro zone, September’s consumer confidence dropped more than expected. In the UK, the BoE kept interest rates unchanged, against expectations, at 5.25% after 14 consecutive rises in a split decision (5 votes in favour and 4 against), where the BoE’s governor, A. Bailey, had the definitive vote. In the US, weekly jobless claims dropped unexpectedly to the lowest reading since January whereas Philadelphia Fed index dropped in September more than expected, as well as August’s existing home sales. In Mexico, July’s retail sales moderated more than expected. In Japan, the BoJ kept its monetary policy unchanged and shows no signs of changing in the short term, whereas September’s PMIs fell more than expected and August’s core inflation remained at 3.1% YoY vs. the expected rise (general figure at 3.2% vs. 3.3% previously). On the geopolitical side, Russia decided to temporarily suspend diesel exports to resupply the domestic market.
What we expect for today
European stock markets would open with slight drops that would increase in view of poor PMIs in Europe, but which could recover towards the end of the session. Currently, S&P futures are up +0.18% (the S&P 500 ended down -0.60% vs. the European closing bell). Volatility in the US rose (VIX 17.54). Asian stock markets are mixed (China’s CSI 300 +0.91%, Japan’s Nikkei -0.43%).
Today in Europe and the US we will learn September’s PMI, in Spain the final 2Q GDP, in the UK August’s retail sales and in Mexico July’s IGAE economic activity.