TOPICS MENTIONED IN THIS MARKET BRIEFING:
- LEuropean Stock Exchangesmonitor ECB announcements
- Wall Street remains feverish ahead of Fed decisions
- Chart of the day – Bitcoin : a long term channel
European stock markets monitor ECB announcements
European Stock Exchanges are up at the start of the session on Wednesday, driven by banking stocks, after the announcement of an exceptional meeting of the Board of Governors of the European Central Bank on the evolution of the bond markets.
Investors are also awaiting monetary policy announcements from the US Federal Reserve in the evening.
According to several sources, the Governing Council of the ECB will hold a surprise meeting this Wednesday at 11:00 a.m. to discuss recent sell-offs in the government bond markets, highlighting the institution’s concern over rising costs. borrowing from some countries in the bloc, especially the most heavily indebted ones.
The announcement last week by the ECB of its intention to engage in several rate hikes this year in the face of inflation has amplified the yield differential between Italian and German bonds.
Investors are preparing in parallel with the announcements at 8:00 p.m. from the Fed, which could accelerate the rise in its rates.
Wall Street remains feverish ahead of Fed decisions
Wall Street ended in disarray on Tuesday, after a seesaw session, ahead of the long-awaited statement from the United States Federal Reserve (Fed) after its monetary policy meeting, investors awaiting clues on the tightness of its measures against inflation.
Analysts are expecting the US central bank to announce on Wednesday that it will raise interest rates by 50 basis points. Some fear, however, that the Fed decides on a hike of 75 basis points, in the wake of the surge stronger than expected in consumer prices in the United States in May, according to data published Friday.
Traders now estimate a more than 90% chance that the US central bank will raise rates by 75 basis points, up from 3.9% a week earlier.
Producer prices in the United States remained high in May due to the rise in oil prices, although their year-on-year increase was in line with expectations.
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Today’s economic calendar:
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CHART OF THE DAY – Bitcoin: a long-term channel
On this graph in logarithmic view, it is clear that prices are moving in a long-term bullish channel. Thus, the rback on the lower band of the channel coupled with the old historical highs towards $20,000 could trigger rebound towards $24,000.
However, if the market fails to recover, the decline is likely to continue in the coming weeks. In fact, udon’t foray under the 20,000 dollars would confirm the double summit (chart figure) with a goal theory around $12,500.
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