Cautious stride into positive territory for Euro markets

Major European indexes are moving in a controlled manner as investors continue to assess Powell’s speech in Jackson Hole that sent a widening wave of risk aversion into global markets.

In particular, the pan-European index Stoxx 600 moving upward 0.7% at 425.14 units, with the banking sector that received the greatest pressure yesterday today reacting with +1.7% while all sectors of the index show a positive sign, except for raw materials companies.

The picture is similar in the individual European dashboards, with the German one DAX to 13,000 units with a rise 0.8%the French CAC 40 at 6,274 units with +0.82%as well as the British one FTSE 100 which started the trading week today due to a holiday yesterday and is strengthening by 0.7% moving to 7,475 units.

In the markets of the region, the Italian FTSE MIB moving upward 1.1% and is at 22,090 units, just like the Spanish one IBEX 35 which makes profits 0.9% moving to 8,046 units.

In his much-anticipated speech at the Fed’s annual conference in Jackson Hole, Wyoming, Jay Powell sent a clear message that the Fed will continue aggressive monetary tightening, even if it means “some pain” for households and businesses, something which shook investors by ending the euphoria of the summer rally.

European officials, such as Isabelle Schnabel, a member of the ECB’s Board of Directors, have been moving in a similar tone in recent days, who reiterated her position that the European Bank must move aggressively to limit rising inflation, even if this entails the risk of recession.

On the macro front, Spanish inflation eased for the first time in four months, although rising energy prices mean the respite in the price rally may be short-lived.

In any case, harmonized consumer prices rose at an annual rate of 10.3% in August, slowing from July’s record high of 10.7%.