Volatility remains high in markets as they try to assess the consequences of the general tightening of central bank policies and the lowering of the IMF’s forecast for the global economy in 2023, all against the backdrop of runaway inflation. Rumors of an extension of the Bank of England’s emergency buyback program could, however, bring some calm to the stock market.
The Old Lady of Threadneedle Street has privately told several banks that she may extend her emergency bond-buying program beyond the October 14 deadline, according to sources familiar with the discussions cited by the FinancialTimes.
A volte-face by the Bank of England?
This information goes against the statements of the governor of the central bank, Andrew Bailey, who on Wednesday urged investors to prepare for the end of the program scheduled for October 14. Anyway, the pound sterling is regaining some height against the dollar after hitting a two-week low.
Asian markets continue their decline this morning, while trading above their low for the day, while contracts future on US indices rose slightly following an irregular closing. The Dow Jones gained 0.1%, while the S&P 500, which hit a year low in the session, pared its losses to end down 0.7%. The Nasdaq Composite fell 1.1%.
The US PPI ahead of inflation
The producer price index for September in the United States will therefore be one of the main events of the day, before the publication, in the evening, of the “minutes” of the last meeting of the monetary policy committee of the Fed. This report may reveal whether FOMC members were overtly concerned about the risk of interest rates rising too quickly. However, the remarks made since by several Fed officials leave little room for doubt as to a new major tightening of the Fed funds rate, after the 0.75% announced last month.
Still on the subject of central banks, Christine Lagarde is due to speak this afternoon at the annual meeting of the Institute of International Finance.
LVMH still confident
LVMH showed confidence in the continuation of double-digit sales growth despite the sharp slowdown in the global economy and inflationary pressures. The world’s number one luxury company has exceeded analysts’ expectations with growth that has not really slowed since the first half.
Eutelsat confirmed its revenue target for operating activities for the financial year ending in June 2023, while this indicator came out in line with management expectations in the first quarter.
Coface. Moody’s Investors Service has raised the outlook for the credit insurer’s Baa1 credit rating from stable to positive.