Volatility in the financial markets decreased ahead of central bank meetings in Australia, Canada, and Europe

US stock exchanges were closed on Monday due to the banking holiday.

European stock markets ended with strong gains yesterday. European technology stocks reached a 20-year high and the Stoxx 600, the main European index, increased by 0.7%. Britain's FTSE 100 added 0.7%, France's CAC 40 increased by 0.8% and Germany's DAX jumped by 1%. Italy's FTSE MIB added 0.8%, Spain's IBEX 35 increased by 0.2%. Rail traffic in Germany has been limited for the fifth day because of a train drivers’ strike: Deutsche Bahn was able to provide only 30% of its long-distance and 40% of its regional trains on Monday. This is the third strike this year, and the parties cannot find a compromise. At the same time, the volume of new orders from German industrial enterprises increased by 3.4% in July compared to the previous month and was the highest since the data began to be tracked.

The famous airline Ryanair has abandoned its plans to buy Boeing 737 Max 10 planes. The reason is the too high price of the airliners. Ryanair is now considering options with the purchase of competitive aircraft from Airbus.

Gold prices are slowly but surely rising. From a fundamental point of view, the soft monetary policy contributes to the growth of precious metal prices. Therefore, gold and silver prices tend to rise before the announcement of the "tapering" (QE program cutting).

The price of aluminum jumped to a maximum of more than 10 years against the background of the state coup in Guinea, which put under threat the supply of the metal from that country.

Oil prices fluctuated around $70 per barrel of the WTI brand. The situation in the oil market remains uncertain. On the one hand, oil prices are affected by a slowdown in demand in Asia and the US, amid a growing number of Delta cases. On the other hand, global demand for oil is still significantly higher than the supply, which should contribute to the growth of prices.

China's trade surplus surged to $58.34 billion, the highest since January. Exports increased by 25.6% compared to the previous year, and growth in July was 19.3%. Imports increased by 33.1% year-over-year and exceeded analysts' expectations, who had expected negative data because of port closures due to COVID-19.

The Reserve Bank of Australia (RBA) kept interest rates at record lows and left monetary policy unchanged. Previously, Australia had intended to begin cutting stimulus from September this year, but the economic recovery was interrupted by the Delta outbreak and restrictions imposed across the country. The country's GDP is expected to fall substantially in September and the unemployment rate is expected to rise in the coming months.

Main market quotes:

S&P 500 (F) 4,535.43 0 (0%)

Dow Jones 35,369.09 0 (0%)

DAX 15,932.12 +150.92 (+0.96%)

FTSE 100 7,187.18 +48.83 (+0.68%)

USD Index 92.22 +0.19 (+0.20%)

Important events for today:
  • – Australia RBA Interest Rate Decision (m/m) at 07:30 (GMT+3);
  • – Australia RBA Rate Statement (m/m) at 07:30 (GMT+3);
  • – Germany ZEW Economic Sentiment (m/m) at 12:00 (GMT+3);
  • – Eurozone ZEW Economic Sentiment (m/m) at 12:00 (GMT+3).

by Justforex, 2021.09.07

We advise you to get acquainted with the daily forecasts for the major currency pairs.

This article reflects a personal opinion and should not be interpreted as an investment advice, and/or offer, and/or a persistent request for carrying out financial transactions, and/or a guarantee, and/or a forecast of future events.

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