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Markets suffered a risk-off session amid concerns over the debt ceiling in the U.S. Volatility jumped and stocks were lower across advanced and emerging economies as Republicans blocked a Democratic move to raise the debt limit. U.S. Treasury Secretary Janet Yellen warned that her department will run out of cash around October 18.

During the last session of the quarter, financial markets traded cautiously amid concerns on inflation, fiscal uncertainty in the U.S. and ahead of relevant economic data releases today.

Yesterday investors traded with optimism amid better than expected economic sentiment data in advanced economies. In particular, the U.S. non-manufacturing ISM index for September increased by 0.2 points to 61.9 while the final Composite PMI in the euro area remained at elevated levels (56.2) despite falling by 2.8 points.

Investors traded yesterday with a risk on mood as U.S. Democrats and Republicans agreed on a truce in the debt-ceiling standoff, easing concerns of a possible near-term government debt default. On the data front, industrial production in Germany fell by -4.0% mom in August while the U.S. weekly jobless claims fell to 326k last week.

Financial markets started the week with mixed results, amid feeble economic data releases. In the U.S., industrial production fell in September by 1.3% (-0.1% in August), the largest decline since February.

During a volatile session, financial markets ended with negative results, taking a breath from the recent rally and refocusing on the risks around the growth outlook, lingering inflationary pressures and changes in monetary policy.

In yesterday’s session, central bankers’ comments centered the stage again, as investors positioned for today’s release of the key CPI October data in the U.S.

Equity markets recorded a modest pickup on Thursday, recovering from the selloff in the previous session, after the stronger-than-expected U.S. CPI October data reinforced fears about intensifying inflationary pressures.

In yesterday's session investors traded cautiously amid concerns on the new coronavirus variant and mixed economic sentiment data releases. November manufacturing PMIs ticked up in the euro area (58.4) but decreased in Spain (57.1 vs 57.4 in October), China (49.9 vs 50.6) and the U.S. (58.3 vs 58.4).

Risk-aversion dominated financial markets on Thursday, as fears about the potential impact of the omicron variant regained investors’ attention, which were also taking position for the key US November CPI inflation report, to be released today (consensus: 6.8% y/y, after 6.2% in October).

During a volatile session, investors continued to trade with a risk-on mood, digesting the recent announcements by the world’s major central banks, which are showing a more vigilant approach to the risk of inflation.

In yesterday's session, investors sentiment continued to improve amid some easing concerns about the impact of the Omicron variant and robust US labor market data. In particular, new unemployment claims were unchanged last week while the number of people of people receiving benefits declined by 8k to 1.859k.

Financial markets extended gains on Tuesday as investors continued to bet that the ongoing economic recovery could sustain the spike in COVID infections across the world.

Financial markets recorded a positive start of the week, supported by the better-than-expected Q4 GDP print in China (4% y/y) and positive expectations for the corporate earnings season later this week.

Investors traded cautiously on Wednesday, on the back of mixed results from the Q4 corporate earnings season and with the focus still on expectations about higher interest rates across financial markets.

Investors started the week with a pronounced risk-off mood and demand for safe assets rose amid rising geopolitical tensions between Russia and Ukraine. In stock markets, volatility went up and losses were broad-based across the board, although dip buyers pushed US indices back to positive territory late in the session.

In yesterday's session, financial markets remained volatile amid rising geopolitical tensions around Ukraine. In addition, the new IMF macroeconomic forecasts did not have a positive impact on investors' sentiment as they showed a lower growth of global GDP for 2022 (from 4.9% to 4.4%), with a broad-based revision across the main economies.

In yesterday’s session investors continued to digest the outcome of the Fed’s meeting and received positively the US 4Q GDP data (up by 1.7% qoq).

Financial markets closed last week with mixed results, with equity prices falling across Europe and EMs but recording a late-session rally in the US, as investors weighed the prospect of a more aggressive withdrawal of monetary policy stimulus by the Fed with upbeat earnings reports from some key US tech firms (e.g. Apple).

In yesterday's session investors' sentiment continued to improve moderately amid mixed comments by Federal Reserve and ECB members. In the US, Cleveland Fed President Loretta Mester said that she expects inflation to ease during the course of 2022, as the Fed tightens credit conditions.