According to our analytics team, U.S. stocks are expected to continue to move mainly sideways, but on increased trading volume as ST indicators continue to move sideways in their continuing effort to find footing from which to rally this week, likely if the EU central bank acts to ease rising interest rates in Spain and Italy.
Shallow rallies last month attended the promise of stimulative moves from the world’s central banks, with hopes lifted at month’s start by ECB President Draghi’s pledge to do whatever it takes to save the euro, and Fed policy meeting minutes suggesting members largely inclined to believe the central bank may need, once again, to step up to the plate of aggressive monetary measures. China’s slowing growth has kept investors guessing, with Beijing steadfast in maintaining a more conservative approach in order to prevent another speculative housing bubble. Last week’s Jackson Hole speech showed Chairman Bernanke eager to protect a record of administering unconventional tools in his efforts to maintain economic growth in the US, making it clear that additional tools remain at the bank’s disposal and may be used in the futures should signs signal the economy faltering, and/or to bolster hiring, which he noted to be a “grave concern.” Mr. Draghi’s recent comments suggest Thursday’s bond-buying program is likely to focus on short-dated government debt, said within the scope of the ECB mandate. US economic reports this holiday-shortened week may tweak investors’ expectations for any QE3 announcement at the Fed’s September policy meeting, giving rise to more bad-news-is-good-news market reactions.
Trading is expected to pick up this week, as well, with summer holidays ending and school openings returning many to their trading desks. Stock prices may remain somewhat range bound in front of market-movers at week’s end, with the ECB policy decision due for Thursday, to be followed by President Draghi’s bond-buying outline, and the US monthly nonfarm payroll release set for pre-open disclosure on Friday. Upcoming posts and media reports throughout the week may tilt sentiment as well, as they hint at ECB plans and give further guidance that the Fed may utilize when considering the need for further monetary action.
Asian markets retreated from Monday’s gains, with equities broadly lower after Beijing failed to take further action to help stimulate its softening economic growth, despite evidence of slowing domestic demand and a falloff in exports. China’s official manufacturing PMI report showed a greater-than-expected slump to 49.2 in August, a nine-month low and below the 50 level that signals contraction. Economists anticipated the number would match July’s 50.1 print. The HSBC manufacturing post marked a similar trend among small and medium-sized Chinese firms, posting at 47.6 from July’s 49.3.
The Shanghai Composite lost 0.8% today, while Hong Kong’s Hang Seng dropped 0.7%. Japan’s Nikkei slid 0.1% and South Korea’s Kospi dropped 0.3%. Australia’s S&P/ASX 200 closed 0.6% lower after the Reserve Bank, as anticipated, left interest rates unchanged at 3.5%, and provided no hints of further easing intentions.
发表于 2012-9-4 08:58
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发表于 2012-9-4 09:46
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