Markets drift ahead of payrolls test

Markets drift ahead of payrolls test

A Look Ahead: Markets Brace for a Volatile Ending to a Turbulent Week

Investors around the world are donning their “risk-off” hats as they prepare for the end of a highly volatile week in the markets. The Bank of Japan’s recent policy tweak and concerns over US yields have kept investors on edge. However, there may be some hope on the horizon, as futures indicate that European stocks may open higher today. Whether these gains can be sustained, however, remains to be seen.

The pan-European STOXX 600 index has been on a downward trend, hitting a more than three-week low. It is also on track to break its recent run of gains. Today, the market could use some Friday cheer to turn things around.

Before the eagerly awaited US non-farm payroll report later in the day, investor attention will be focused on construction PMI data from the euro zone, UK, and Germany. These figures could provide valuable insights into the health of the construction sectors in these regions. Additionally, the performance of the pound will be closely monitored, following the Bank of England’s modest rate hike on Thursday. Sterling experienced significant fluctuations after the announcement, and it has seen a 0.2% increase during Asian trading hours.

The Chinese central bank has announced that it will utilize monetary policy tools, such as reserve requirement ratio cuts and open market operations, to ensure liquidity in the banking system. This statement comes one day after the governor of the central bank pledged to allocate more financial resources towards the private sector. Investors are hopeful that these measures, along with other stimulus and policy easing from Beijing, will help boost the sluggish rebound of the world’s second-largest economy.

In the corporate world, big tech earnings have been a mixed bag. Apple, for example, reported that a sales slump is expected to continue into the current quarter, despite beating Wall Street’s sales and profit targets for the fiscal third quarter. On the other hand, Amazon.com Inc. announced sales growth and profit that exceeded expectations. The company attributed its success to faster and more cost-effective delivery services, as well as a reduction in cloud-computing headwinds.

• Zhengzhou city in China implements property support measures.
• China’s savers may cause liquidity trap.
• Asian shares rise as focus shifts to US payrolls.

Looking ahead, there are several key developments that could potentially influence the markets today. These include the release of economic data such as the UK July construction PMI, Italy June industrial production, Germany July construction PMI, and Eurozone retail sales.

In summary, investors are bracing themselves for the end of a turbulent week in the markets. While there are indications of a higher open for European stocks, uncertainties still loom. The performance of construction sectors, the pound, and the Chinese central bank’s actions will be closely watched. Additionally, the mixed results of big tech earnings add to the anticipation of what lies ahead. As the day unfolds, market participants eagerly await the release of economic data that could further sway market sentiment.

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