The financial markets are now eagerly awaiting the first US TV presidential debate between US President Donald Trump and his Democratic challenger Joe Biden at 3 a.m. CET on Wednesday night. At the center of the debate will be corona pandemic response, the economic situation, and very likely Trump's tax practices, which are currently making the headlines.
Meanwhile, the New York Stock Exchange continued its recovery with momentum at the beginning of the week. The Dow Jones Industrial posted gains of around +2% during the day and then closed with a solid +1.51% gain to 27 584.06 points. This means that the Dow has gained more than 1000 points since the interim low in the previous week and is now at its third consecutive winning day. The S&P 500 also gained +1.5% to 3 351.60 points. The technology-heavy Nasdaq 100 rose even more strongly with a daily gain of +1.91%. In addition to the strong demand for technology stocks, a series of M&A activities also created a good mood on the trading floor. For example, the American mining group Cleveland-Cliffs acquired the US business of the world's largest steel producer ArcelorMittal for around USD 3.3bn. Another merger involved the US betting provider Caesars Entertainment, which is taking over its British competitor and joint venture partner William Hill for GBP 2.9bn. Investors are still hoping for further economic stimulus from the major central banks. In addition, efforts are still underway in Washington for a further corona aid package. Nancy Pelosi, Speaker of the US House of Representatives, announced a new Democratic bill that provides for a compromise of USD 2.2 trillion. Asia's stock markets have not really benefited from solid overseas guidance and are trending mixed this morning.
According to ECB head Christine Lagarde, the economic recovery in the euro zone remains fragile and the ECB must therefore be prepared to adjust its instruments if necessary. Speaking to the European Parliament, the top European central banker described the recovery from the corona shock as “incomplete, uncertain and bumpy“. Lagarde emphasized once again that the ECB would also closely monitor the development of the euro exchange rate. The fact that the appreciation of the euro is causing the ECB increasing headaches was also underlined yesterday by Italy's central bank chairman Ignazio Visco, who called the recent rise in the euro “worrying“. At the beginning of September, the common currency reached its highest level against the US dollar since mid-2018 at over 1.20. In the meantime, the greenback has recovered somewhat and pushed the euro to just under 1.17.
By mid-2021, the Kingdom wants to conclude a comprehensive trade agreement with the United States. According to the British Secretary of State for Trade, Liz Truss, Great Britain must become more independent in trade after leaving the European Union. The trend would be more towards regions and countries that would grow faster. Today the British chief negotiator David Frost and the EU representative Michel Barnier will meet in Brussels. This is the start, under great time pressure, of the last agreed round of negotiations on future relations after the Brexit. According to Brussels, an agreement must be reached by the end of October, or by the beginning of November at the latest, which can come into force at the beginning of 2021 and which must be ratified by numerous parliaments before then. On Thursday and Friday, the EU heads of state and government will then discuss the results of the negotiations with the British government.
|08:45||FR||Consumer Confidence (September)||94.0|
|09:00||SP||Consumer Prices (September, y/y)||-0.5%|
|11:00||EZ||Economic Sentiment (September)||87.7|
|11:00||EZ||Consumer Confidence (September)||-13.9|
|14:00||GE||Consumer Prices (September, y/y)||0.0%|
|14:30||US||S&P Housing Prices 20-biggest Cities (July, y/y)||+3.46%|
|16:00||US||Consumer Confidence (September)||84.8|
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Source: LGT Bank (Switzerland) Ltd.
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