US Federal Reserve (Fed) Chairman Powell said that he will be firmly committed to controlling inflation, once again revealing his hawkish stance, making investors worried that the Fed may further tighten monetary policy, US stocks opened lower on Thursday (8th).
Before the deadline,Dow Jones Industrial Averagefell more than 150 points or nearly 0.5%,Nasdaq Composite Indexfell more than 50 points or 0.5%,S&P 500 Indexfell nearly 0.5%,Philadelphia SemiconductorThe index fell 0.6%.
Powell told a seminar hosted by the Cato Institute that the Fed must take direct action on inflation, while reiterating earlier remarks at the Jackson Hole annual meeting of global central banks: “Historical experience strongly warns us not to Easing policy prematurely.”
At the same time, money market investors increased theirEURThe European Central Bank announced today that it will raise interest rates by 3 yards (75 basis points) in response to soaring inflation, and also hinted that further interest rate hikes may be in the future before inflation falls back to its 2% target level.
In addition, the European Central Bank also significantly raised its inflation forecast for 2022.EURThe adjusted consumer price index (CPI) is 8.1%, the previous estimate is 6.8%; the 2023 CPI is expected to be 5.5%, the previous estimate is 3.5%; the 2024 CPI is expected to be 2.3%, the previous estimate is 2.1% .
In terms of data, the U.S. Department of Labor announced the latest unemployment benefits data. Last week, the adjusted number of initial claims for unemployment benefits was 222,000, a decrease of 6,000 from the previous revised 228,000, which was lower than the market expectation of 240,000 for four consecutive weeks. The drop was the lowest since May this year, indicating that despite the uncertain economic outlook, the job market remains healthy. Market estimates, a healthy job market may increase the Fed’s confidence in aggressive interest rate hikes.
As of 21:00 on Thursday (8th) Taipei time:
Stocks in focus:
GameStop(GME-US) rose 4.76% to $25.18 a share in early trade
Meme stock GameStop rose more than 9% in premarket despite widening losses and falling revenue last quarter as the company announced a deal with the company.cryptocurrencyThe exchange FTX establishes a partnership to boost investor confidence. On the earnings front, few Wall Street analysts observe GameStop, making it impossible to compare the company’s results to market estimates.
United Airlines (UAL-US) rose 0.44% to $38.77 a share in early trade
United Airlines said today that it has agreed to support Embraer-backed start-up Eve Air Mobility (EVEX-US) to purchase 200 electric air taxis, with options for 200, expected to be delivered as soon as 2026, in addition to investing $15 million in the latter. United believes that once air taxis become available and replace car travel, it will help reduce carbon emissions.
Tesla (TSLA-US) fell 0.05% to $283.55 a share in early trade
According to data released by China, Tesla delivered more than 75,000 Chinese-made electric vehicles in August, which was slightly lower than the record high in June, but rebounded sharply from nearly 30,000 in July. Chinese authorities expect vehicle sales to continue to grow rapidly in September, while the supply of chips and the capacity of automakers will increase, even as the outlook for the coronavirus outbreak remains uncertain.
Today’s key economic data:
The number of Americans receiving unemployment benefits last week reported 222,000, expected 240,000, the previous value of 228,000
The number of people receiving unemployment benefits in the United States last week reported 1.473 million, expected 1.435 million, and the previous value of 1.437 million
Wall Street Analysis:
Nadia Lovell1, senior U.S. equity strategist at UBS Global Wealth Management, said it is clear that the Fed has repeatedly emphasized that it will not stop raising interest rates until inflation returns to its 2% target.
NatWest Markets analyst Jan Nevruzi said the market may take a wait-and-see approach in the short term, and while a rate hike of 2 or 3 in September is important, more important is whether inflation has peaked and what the Fed’s path to future rate hikes will be.
Ryan Lemand, capital advisor to the Securrency board, sees worrying economic conditions in Europe, with the worst energy crisis going on since the oil embargo in the 1970s, Europe is facing a recession, one of the worst, and risk assets are not correctly reflects this.