Financial Markets Daily Report25 July 2022
In the last session of the week, investors' recession fears increased following the worse-than-expected economic sentiment data. In particular, July's Composite PMIs for the euro area and the US fell below the 50 points threshold, with decreases in both the services and manufacturing indices.
- In the last session of the week, investors' recession fears increased following the worse-than-expected economic sentiment data. In particular, July's Composite PMIs for the euro area and the US fell below the 50 points threshold, with decreases in both the services and manufacturing indices.
- In this context, yields on sovereign bonds sank in both sides of the Atlantic as investors do not expect now the Federal Reserve and the ECB to raise interest rates as far as they expected some weeks ago. In stock markets, equities edged modestly up in Europe while decreasing in the US.
- This week the focus will be on Q2 GDP preliminiary releases (US on Thursday; Spain and euro area on Friday), on July flash estimates of inflation (Spain and euro area on Friday) and on the US Federal Reserve meeting (Wednesday), where we expect interest rates to be hiked by 75bp.