The second half
of October on Wall Street began with a moderate decline in average stock
prices, but the S&P 500 broad market index was kept within the same range
mostly above the 4,270-4,300 support area. Inflation worries were noticeable
ahead of a fresh U.S. consumer price index (CPI) which will be released today,
although it has already become clear that the Federal Reserve (Fed) has a
tendency to focus more attention on job targets and has a more "wait and
see" kind of approach when it comes to growing inflation.
been acting more like an alternative to the Dollar rather than a safe haven
asset this year, and now it is acting more like risky assets. Such a
transformation is due to the unprecedented stimulus package from the U.S.
Federal Reserve (Fed). The fact that there is more money in the market at a
time when interest rates are low, creates a situation in which gold prices are
being pushed up as part of this money is being used to buy gold assets. While
gold is acting more like a risky asset, the U.S. Dollar may be seen to be
acting like a safe haven asset.
In the middle
of the business week, the markets have still failed to form any stable trend.
Judging the overall situation on a conventional base of weighted average
instruments, such as the S&P 500 or the Euro Stoxx 50 indices, the several
hours of steady rebound when the market community was trying to buy fresh dips,
which were formed yesterday, were followed by a new day of sales again, and
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.
futures skyrocketed over the last month, since mid-August, creating an amazing
phenomena of the year. Prices surged by 45% from the August 16 bottom of $30.3
per pound to above $44 per pound as of September 13. The radioactive metal left
other commodities behind in the dust and most of the other financial instrument
demonstrated a “chain reaction” within financial markets.
drivers behind this amazing rally were seen to be partially of a speculative
nature, but they also have a fundamental background behind them that may lead
to a sustainable nature of the growth.
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.