Last week i global markets have shown a downward trend, a symptom of the uncertainty of operators, who are digesting a series of crucial issues, including the US elections, expectations of a reduction in interest rates and not exactly exciting results of some companies.
Central banks, bearish evidence
In fact, there are meetings on the agenda three major central banks: first of all, the Federal Reserve, which should not touch rates, but could provide, at the end of the meeting on Wednesday, new indications on a possible intervention in September, much awaited by the market. Also on Wednesday, the speaker will take the floor BoJ (Bank of Japan), which could intervene in the opposite direction, slightly raising the cost of money. It will be there on Thursday Bank of England to provide answers, but to know what he will do you would need a crystal ball, as general UK inflation has fallen and the labor market has shown signs of tiredness, but inflation in services and the rise in wages are still act.
The data on p. is also coming outof the second quarter of the Eurozone, but also of Germany, France, Italy, Spain, second quarter GDP (first estimate).
The numbers of Intesa and Leonardo arrive
La quarterly season is coming even more to the fore these days both in Europe and in the USA. Above all, four of the so-called "magnificent seven" (Microsoft, Meta, Apple and Amazon) are expected to be put to the test after the disappointing numbers of Tesla and Alphabet last week.
BP and Airbus accounts are also scheduled. The numbers of Intesa, Poste Italiane, Leonardo and Amplifon arrive in Italy.
Cars and luxury sales time
Our Ftse Eb Monday lost 0,5% after the wave of sales that hit almost all European stock exchanges last week due to some disappointing quarterly reports, particularly in the Automotive and Luxury sectors.
From July 1st to yesterday the index Russell 2000 gave Bloomberg's Magnificent Seven index about 16 points.
The weak data published by the food sector is behind these performances luxury (LVMH and Kering), weakness come on semiconductors (Stm indicated a recovery of the industrial part perhaps from the fourth quarter of the year, against previous indications that he was already in the third). In the field automotive: Stellantis, Renault and Nissan they lowered their expectations for the year (after Volkswagen and Porsche had done so a few days earlier), and so on.
Bags in correction?
Even in the USA the start was not the best: Tesla and Alphabet (Google) have not upheld the market's high expectations. If at the end of June we had witnessed the rotation (therefore the decline of the Nasdaq and the rise of the Russell 2000), now we have seen a generalized decline, typical of slowdown phases, the most difficult because we have come from good years and expectations are high.
In recent weeks, writes Banor, “the market had convinced itself that the slowdown was minimal, that the Fed would come to the rescue by lowering rates, that China would stimulate the economy with a fiscal and monetary plan and it was no longer believed that possibility of a negative GDP coming. Now the debate has changed."
The markets are wondering if the indications received from the companies are correct first signs of a recession or they are the effect of the marked slowdown that the economy suffered in the months of May and June after many months of high rates.
There are those who bet on the doveish Fed, the unknown factor of the Bigs
In the first case the Fed, at the July 31 meeting it could announce that it is ready to cut rates in September to support the recovery. And getting there with weak markets could convince, during the press conference, to give more aggressive messages to avoid a vicious circle. But much will depend on the results of Apple, Meta and Amazon.
According to Mark Haefele, Chief Investment Officer, UBS Global Wealth Management, it is Market volatility is likely to continue. However, it is believed that the technology sector is expected to find support in the coming weeks and recover.
Gold, bitcoin, jewelry
The uncertainty is also reflected in the . Demand in China has collapsed in the face of record prices, with sales at jewelers struggling as buyers sit idly by. There Total bullion demand fell nearly 6% compared to the previous year in the first half at 524 tons, The data implies a drastic 52% drop in jewelry purchases in the second quarter, according to calculations by Bloomberg. This is a sharp turnaround from the first three months of the year, which was characterized by purchases by the Chinese central bank and domestic consumers as a hedge against a real estate crisis. There are clear signs that China's high prices and sluggish economy are hitting sales of discretionary goods like jewels.
Turning to crypto, Trump, as guest of honor at the Bitcoin Conference in Nashville, the industry's largest annual gathering, did not disappoint expectations, promising to make the US "the crypto capital of the planet”. Yet Trump himself has long been among the fiercest critics of cryptocurrencies.
