Global markets are on a negative track as investors remain cautious ahead of the messages to be given by US Federal Reserve (Fed) Chairman Jerome Powell at the Jackson Hole Economic Policy Symposium starting tomorrow.
As the fight against inflation, which has been ongoing for some time around the world, draws to a close, investors continue to focus on signals regarding the steps the Fed will take in the future in the US, where recession fears are also prevalent.
While the Fed’s 25 basis point rate cut next month is considered certain in money market pricing, uncertainty continues in pricing for the steps to be taken by the end of the year.
Analysts said Powell’s statements at the Jackson Hole Economic Policy Symposium on Friday will provide clues about future policies, adding that such guidance could increase volatility in the markets.
On the other hand, Fed Board Member Michelle Bowman explained that they made significant progress in reducing inflation last year and have seen further progress in this area in recent months.
Bowman noted that he still sees some upside risks to inflation and said the bank will remain cautious about making changes to its current policy.
Bowman stressed that wage increases continue to remain above a pace consistent with the inflation target, and said that price stability must be closely monitored while being vigilant against the risk of a significant weakening in the labor market.
With these developments, the US 10-year bond interest rate is currently balanced at 3.81 percent, while the dollar index closed at its lowest since December 29 at 101.4 yesterday.
While the ounce price of gold closed at a record level yesterday at $2,514, the barrel price of Brent oil continued its downward trend for the third consecutive trading day, falling to $76.7.
With these developments, the Dow Jones index rose by 0.15 percent, the S&P 500 index rose by 0.2 percent and the Nasdaq index rose by 0.33 percent yesterday. Index futures contracts in the US started the new day with an increase.
While European stock markets followed a negative trend yesterday, inflation data announced in the Eurozone was in line with expectations.
Analysts said that the European Central Bank (ECB) is expected to cut interest rates by 25 basis points in its monetary policy decision to be announced next month.
With these developments, the FTSE 100 index in England fell by 1 percent, the DAX 40 index in Germany fell by 0.35 percent, the CAC 40 index in France fell by 0.22 percent and the FTSE MIB index in Italy fell by 0.57 percent. Index futures contracts in Europe started the new day with an increase.
While the selling-heavy trend on the New York Stock Exchange was seen to have spread to Asia, excluding South Korea, on the new day, Chinese technology companies were seen to be leading the decline.
The news flow that Wallmart will sell its shares in some companies due to low consumer appetite in China caused deflation concerns in the country to have an impact on asset prices again.
On the other hand, the dollar/yen parity fell for the third consecutive trading day yesterday, closing at 145.27 with a 0.9 percent decrease, and is currently at 145.71, 0.3 percent above the previous close.
Near the close, Japan’s Nikkei 225 index fell 0.3 percent, Hong Kong’s Hang Seng index fell 0.9 percent and China’s Shanghai composite index fell 0.5 percent, while South Korea’s Kospi index rose 0.2 percent.
Following a sales-heavy trend yesterday, the BIST 100 index in Borsa Istanbul closed the day at 9,982.28 points, down 0.72 percent compared to the previous close, while the Central Bank of the Republic of Turkey (CBRT) left the policy rate unchanged at 50 percent.
Dollar/TL, which closed at 33.8862 with a 0.4 percent increase yesterday, is being traded horizontally at 33.8970 at the opening of the interbank market today.
Analysts stated that the data agenda is calm in the country today, and that the Fed’s meeting minutes in the US will be followed abroad, and noted that from a technical perspective, the 10,000 and 10,100 levels are resistance in the BIST 100 index, while 9,900 and 9,700 points are support.
