Market: morale depressed by the words of Jerome Powell


(CercleFinance.com) – European stock markets fell on Thursday (-0.4% in London, -1.1% in Frankfurt, -0.8% in Paris), in the wake of Wall Street the day before when comments from Jerome Powell more ‘hawkish’ than expected cast a chill after the FOMC meeting.

Although the 75 basis point increase in key rates by the Federal Reserve was widely expected by investors, they nevertheless seem to have been surprised by the rather offensive tone adopted by its chairman Jerome Powell.

‘He said it would be premature to take a break as there is ‘some way to go’ to the 2% inflation target, and also noted that the terminal interest rate will most likely be higher than previously expected, ”points Wells Fargo.

All eyes are now on the Bank of England, which is in turn holding its monetary policy meeting and should very likely also announce a key rate hike, probably by 75 basis points there too.

This monetary tightening would come even as the British private sector is sinking into contraction zone, given the composite PMI index which fell further to 48.2 for the month of October, its lowest level since January 2021. .

Among the many publications of corporate results in the morning in Europe, the operators heavily sanctioned BT Group and Geberit (-7% each), BMW (-6%) and Adecco (-3%), but applauded BNP Paribas (+ 3%) and especially ING (+7%).

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