📆 Wednesday, August 14
►European stocks rise after gains in Asian markets and very strong Wall Street session on optimism that the upcoming US CPI report will allow the Federal Reserve to cut interest rates in September. UBS Group led the gains among European financial stocks, with shares rising after the bank's second quarter profit beat estimates. Mining stocks struggled, however, as iron ore prices fell to their lowest level since May 2023 on concerns over Chinese demand. Of note, UK inflation came in below expectations at 2.2% in July (y-o-y), leading to a fall in GBP and increasing hopes of interest rate cuts by the Bank of England.
► U.S. stock futures remained steady following Tuesday’s strong 1.7% rally in the S&P 500, fueled by significantly cooler-than-expected producer price data that increased expectations for today's more important consumer price report to also show inflation remaining on path towards the Fed's 2% target. Forecasts predicting a modest 0.2% increase in both the headline CPI and the core gauge, thus supporting the case for a Fed rate cut in September. The VIX, a key volatility gauge, dropped to around 18, reflecting reduced market concerns but also that investors are at the sidelines before the CPI data release.
Subscribe to see more
