(ABM FN) The Brussels stock exchange is expected to start higher on Thursday. Futures on the Euro Stoxx 50 index pointed to a gain of more than half a percent about an hour before the stock exchange bell.
Trading was still quiet in Brussels on Wednesday on the occasion of All Saints’ Day. The Bel20 rose 0.6 percent to 3,377 points. “October is over and investors are looking at whether there is room for a more positive view of the market,” said investment strategist Wim Zwanenburg of Stroeve & Lemberger. Stock prices fell in October, influenced by rising bond yields.
On Wednesday evening, the Federal Reserve left interest rates unchanged, as expected, and Wall Street responded positively to Chairman Jerome Powell’s explanation, as usual keeping all options open. The S&P 500 gained 1.0 percent, while the Nasdaq tech exchange even added 1.6 percent.
Powell said, among other things, that he expects the economy to weaken in the coming months and that it will help further reduce inflation, although the Fed does not expect a recession. He also pointed out that the rise in bond yields could limit further interest rate increases, but only if long-term interest rates remained “persistently” high.
The Fed had identified another rate hike as likely and thought this step would take place this year, but this has become slightly more uncertain. According to the CME FedWatch Tool, approximately 80 percent of the market is still expecting a 25 basis point increase in interest rates in December.
The Fed expects that the increases will then come to an end and that interest rates will be lowered by 50 basis points next year.
The US Treasury Department also announced that it will auction $112 billion in government bonds next week to refinance the national debt, which is $9 billion more than a quarter earlier. That wasn’t too bad and helped to relax the interest rate markets. The American ten-year yield was quoted at 4.72 percent this morning, after having been above 5.00 percent several times last week.
There was also economic news from pay slip company ADP. The October jobs report showed job growth of 113,000, up from 89,000 a month earlier. 130,000 new jobs were expected.
Job growth was again lower than expected. “The catch-up of small companies compared to large firms has come to a standstill, given the growth there by 18,000 and by 19,000 among small companies,” said market analyst Philip Marey of Rabobank. The official jobs report will follow on Friday.
It also turned out that American industry is still struggling, while construction expenditure has increased. According to ISM, the industry shrank at a faster pace last month. S&P Global’s purchasing managers index showed a pause.
Oil prices fell again on Wednesday after the Federal Reserve left interest rates unchanged, while the market kept a close eye on the latest developments in the conflict between Israel and Hamas. A December future for a barrel of West Texas Intermediate crude oil closed 0.7 percent lower at $80.44 on Wednesday evening in New York.
Sentiment on the Asian stock markets is positive this morning. The Seoul stock exchange is the leader with a gain of 1.7 percent, while Hong Kong, Sydney and Tokyo gain about one percent.
Today the focus is on the interest rate decisions of the Bank of England and Norges Bank, while the weekly US support requests can also count on attention in the run-up to Friday’s jobs report.
On the corporate front, investors are particularly keen on Apple’s figures, after closing hours on Wall Street this evening.
Shurgard signed a conditional purchase agreement in London for a new storage facility. This 6,600 square meter facility will offer more than 1,300 storage units.
Wall Street closing positions
The S&P 500 index rose 1.1 percent to 4,237.86 points on Wednesday. Technology stock exchange Nasdaq rose 1.6 percent to 13,061.47 points and the Dow Jones index rose 0.7 percent to 33,274.58 points.
Source: ABM Financial News
ABM Financial News is a supplier of stock market news, video and data, both for real-time trading platforms and dealing rooms and for online and offline media publications. The information in this article is not intended as professional investment advice or as a recommendation to make certain investments.
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