EUR 100.00 For Business Accounts Only

IBERIAN DAILY 20 MARCH (ANÁLISIS BANCO SABADELL)

NEWS SUMMARY: IBERDROLA, INDRA.


The Fed kept rates unchanged and Powell shows calm
European stock markets ended with gains, although awaiting the Fed meeting and peace talks about the war in Ukraine. In the STOXX 600, Retail and Energy were the best-performing sectors whereas Telecoms and Chemicals were the worst performers. On the macro side, in the US, the Fed kept rates unchanged (moderating the balance sheet reduction from sovereign debt), cutting the 4Q’25 GDP forecast by 4 tenths to 1.7% YoY and raising the core deflator by 3 tenths to 2.8%, but in any case betting on 2 rate cuts in 2025. In the euro zone, February’s final inflation was cut by one tenth (2.3% vs. 2.7% in February), whereas the core data confirmed the preliminary 2.6% vs. 2.7% in January (moderating for the first time in 5 months), which offers room to the ECB to continue cutting rates to 2.0%. On another note, labour costs moderated significantly in the 4Q’24. In Brazil, as expected, the Central Bank raised interest rates to 14.25% from 13.25% previously. In China, in line with expectations, the Monetary Authority kept the 1 & 5Y benchmark loan rates unchanged. On the geopolitical front, Ukraine accepted the proposal of halting attacks on energy targets and in Europe the 2030 White Paper for European Defence was made public, which did not bring any surprises about the investment of € 800 Bn that will be largely financed through domestic budgets.
What we expect for today
Stock markets would open with a slight bearish slant. Currently, S&P futures are up +0.36% (the S&P 500 ended +0.36% higher vs. the European closing bell). Asian markets are falling (China’s CSI 300 -0.83% and Japan’s Nikkei is closed).
Today in the UK BoE meeting and we will learn February’s number of unemployed and January’s (ILO) unemployment rate, in the US weekly jobless claims, March’s Philadelphia Fed index and February’s existing home sales.