Breaking News
Get Actionable Insights with InvestingPro+: Start 7 Day FREE Trial Register here
Investing Pro 0
Ad-Free Version. Upgrade your Investing.com experience. Save up to 40% More details

Marketmind: Mind the (Europe-U.S.) gap

EconomyNov 23, 2021 03:27AM ET
Saved. See Saved Items.
This article has already been saved in your Saved Items
 
© Reuters. FILE PHOTO: People walk past 214 Oxford Street, the former flagship store of British fashion chain Topshop, that has been purchased by the Swedish furniture brand IKEA, in London, Britain, October 26, 2021. REUTERS/Henry Nicholls

A look at the day ahead from Sujata Rao.

When advance prints of Purchasing managers' Indexes (PMI) land, focus will be on businesses' input cost increases and whether they show signs of easing.

The readings may also reinforce the gap between robust U.S. activity and COVID-plagued Europe, potentially further depressing the euro, which plumbed new 16-month lows on Monday.

Monday's euro area consumer confidence indicator offered a warning, falling back below pre-pandemic levels. October PMIs showed bloc's activity slowing the weakest in six months, while businesses' costs rose at the fastest pace in two decades. U.S. and British PMIs fared better but eye-popping price increases still featured.

A price slowdown would vindicate central bankers' who have until now rejected surging inflation as transitory. But Fed Chairman Jerome Powell (re-appointed for another four years) spoke on Monday the corrosive impact of inflation. The United States may also unveil an emergency oil release later in the day to dent energy prices.

Powell's reappointment sent markets into a frenzy of policy-tightening bets; three U.S. rate hikes are priced for 2022, starting June.

U.S. Treasury yields are higher again this morning after 5-8 basis-point rises on Tuesday, while the dollar has moved into a fifth straight week of gains against a basket of currencies.

When does this become a problem for stock markets?

Nasdaq-listed tech shares, vulnerable to higher rates, fell on Monday and are tipped for another lossmaking session. Even a 2% rally in bank shares did not prevent a weaker S&P 500 close. Futures signal weakness there and for European shares.

Finally, El Salvador's plans for a $1 billion bitcoin-backed bond doesn't seem to have benefited the coin very much; it's holding near one-month lows.

Key developments that should provide more direction to markets on Tuesday:

Tuesday, Nov 23

-E.ON to invest $30 billion for green transition

-BOE MPC member Jonathan Haskel speaks

-ECB speakers: ECB board member Pentti Hakkarainen

-U.S. Treasury auctions 7-year notes, 2-year floating rate notes

-Philly Fed Non-manufacturing Business Outlook Survey

-Emerging markets: Nigeria central bank meets

-U.S. earnings:  American Eagle (NYSE:AEO), Medtronic (NYSE:MDT), Best Buy, Dollar Tree (NASDAQ:DLTR), Abercrombie and Fitch (NYSE:ANF), Hewlett Packard, Nordstrom (NYSE:JWN), Gap, Dell Composite PMIs, https://fingfx.thomsonreuters.com/gfx/mkt/lgpdwnbawvo/Pasted%20image%201637613895675.png

Marketmind: Mind the (Europe-U.S.) gap
 

Related Articles

Add a Comment

Comment Guidelines

We encourage you to use comments to engage with other users, share your perspective and ask questions of authors and each other. However, in order to maintain the high level of discourse we’ve all come to value and expect, please keep the following criteria in mind:  

  •            Enrich the conversation, don’t trash it.

  •           Stay focused and on track. Only post material that’s relevant to the topic being discussed. 

  •           Be respectful. Even negative opinions can be framed positively and diplomatically. Avoid profanity, slander or personal attacks directed at an author or another user. Racism, sexism and other forms of discrimination will not be tolerated.

  • Use standard writing style. Include punctuation and upper and lower cases. Comments that are written in all caps and contain excessive use of symbols will be removed.
  • NOTE: Spam and/or promotional messages and comments containing links will be removed. Phone numbers, email addresses, links to personal or business websites, Skype/Telegram/WhatsApp etc. addresses (including links to groups) will also be removed; self-promotional material or business-related solicitations or PR (ie, contact me for signals/advice etc.), and/or any other comment that contains personal contact specifcs or advertising will be removed as well. In addition, any of the above-mentioned violations may result in suspension of your account.
  • Doxxing. We do not allow any sharing of private or personal contact or other information about any individual or organization. This will result in immediate suspension of the commentor and his or her account.
  • Don’t monopolize the conversation. We appreciate passion and conviction, but we also strongly believe in giving everyone a chance to air their point of view. Therefore, in addition to civil interaction, we expect commenters to offer their opinions succinctly and thoughtfully, but not so repeatedly that others are annoyed or offended. If we receive complaints about individuals who take over a thread or forum, we reserve the right to ban them from the site, without recourse.
  • Only English comments will be allowed.

Perpetrators of spam or abuse will be deleted from the site and prohibited from future registration at Investing.com’s discretion.

Write your thoughts here
 
Are you sure you want to delete this chart?
 
Post
Post also to:
 
Replace the attached chart with a new chart ?
1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Thanks for your comment. Please note that all comments are pending until approved by our moderators. It may therefore take some time before it appears on our website.
 
Are you sure you want to delete this chart?
 
Post
 
Replace the attached chart with a new chart ?
1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Add Chart to Comment
Confirm Block

Are you sure you want to block %USER_NAME%?

By doing so, you and %USER_NAME% will not be able to see any of each other's Investing.com's posts.

%USER_NAME% was successfully added to your Block List

Since you’ve just unblocked this person, you must wait 48 hours before renewing the block.

Report this comment

I feel that this comment is:

Comment flagged

Thank You!

Your report has been sent to our moderators for review
Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.
Continue with Google
or
Sign up with Email