Global economic growth
faced a serious sudden throttle with contradictory consequences, as high energy
prices were globally boosting inflation. Logically, low inflation was a serious
problem for economic growth in preCOVID-19 years, meaning low consumer and
investment demand hampered economic growth.
injections from the world’s major central banks, of which the Federal Reserve was
among the first to take action, reversed this trend to a large extent and
bailed countries out of economic turmoil.
Just a day ago,
all trading sessions on stocks were marked by another wave of total sell-off on
Wall Street covering almost the entire spectrum of the market segments. It is
worth mentioning that the "big five" of the U.S. financial
institutions and energy companies came out better than others, with the Bank of
America and JP Morgan Chase even managing to refresh their all-time record
prices before they also very limitedly joined the overall correction. At the
same time, Morgan Stanley, Goldman Sachs and Citigroup lost 2.91%, 2.58% and
September 23rd, the Bank of England (BoE) joined a relay race after
the U.S. Federal Reserve (Fed) had made its move towards monetary tightening.
The U.S. monetary policymaker clearly indicated that it is going to taper
quantitative easing before the end of this year.
The BoE did not point
to any additional monetary stimulus measures in its statement, as it kept its
interest rate unchanged at 0.1% together with the 895 –billion-pound ($1.23
billion) bond purchase program.
After the storm
signal for global stocks in course of the 20th of September’s
"black Monday", when the total downside correction for the Wall
Street's broad market S&P 500 index reached 5.35% at a local bottom point,
compared to the absolute peaks of all time two weeks earlier, the markets on
both sides of the Atlantic are behaving in a much more balanced manner.
A few hours
before the end of an important meeting of the Federal Reserve (Fed), where the
continue to behave with agitation in the course of the current week, as most
investors are still hesitantly awaiting the meeting of the Federal Reserve
(Fed) next Wednesday, which may become a kind of risky turning point for the
prevailing sentiment. The threat of money stimulus tapering, which may be
announced as starting as early as October or in December, is expected to be
pretty limited so that it may not change
the disposition dramatically.
Silver is a
metal that is primarily used for manufacturing and less as a precious metal. It
is used in high-technological processes thanks to its high conductivity, in
manufacturing solar cell batteries and electric vehicles.
demand and the price of silver is directly linked to the business activity
worldwide. The latter is highly dependent on the spread of Delta variant and the
Federal Reserve’s (Fed) stimulus measures perspectives. Such attributes
distinguished silver price movements at the beginning of this week.
The stocks at
Wall Street finished their seventh straight months in moderate or solid gains. On
the first day of September one can already state that August was marked by
another record victory for both S&P 500 broad market index which is well
above the 4,500 landmark and Nasdaq 100 index, mainly of companies in the tech
sector, which is now consolidating higher than another round figure of 15,000
points. Apart from a very small and rather symbolic decline of average market's
quotes in January, shortly after the new year's start, the overall U.S.
prices are moving along with the Dollar-denominated assets against the Greenback
this week. The U.S. Dollar fell under pressure after Federal Reserve (Fed) Chairman
Jerome Powell last Friday reiterated his commitment to easy money with
vast monetary injections into economy.
The decline of the Dollar
was immediately used by alternative assets to make an upside jump in prices,
including platinum. It rose from $975 per ounce on August 27 to above $1011 on
the last summer day, and now is trading slightly above $1007 per ounce.
The paramount intrigue of the week is the results of the Jackson Hole conference run by the Federal Reserve (Fed) and the statement of its Chairman Jerome Powell that is going to take place on Friday. Financial markets are desperately waiting for the major Fed policymaker to announce further perspectives surrounding the monetary policy.
However, the Fed is in awkward situation as, on the one hand, it has clear signs of economic recovery with 6.6% GDP up in the second quarter of 2021, and above 6.4% in the first quarter of this year, together with the first estimate of Q2 GDP growth being 6.5%.
markets continue to slowly and steadily climb higher , with the Euro Stoxx 50
major indicator adding just about 0.8% since the beginning of the week until
noon on Wednesday. However, its increase is almost 2.5% if compared with the
last local price bottom of August 19.
speaking, most of the EU stocks could perform even better if it were not for
the German market which clearly underperformed today after today's
contradictory release of the national business climate gauge regularly measured
by the well-known Ifo Institute on a monthly basis.