The last day of the week comes with just a few important reports on the schedule.
First of all, the United Kingdom published its Gfk consumer confidence report for September, which was lower than expected at -13. It is also considerably lower than last month’s reading.
Japan came next with a set of inflation rate reports. Year-on-year the inflation rate in Japan dropped to -0.4% in August, down from -0.3% the previous month. Core inflation met the forecast of 0%.
Furthermore, Germany published its Ifo business climate report for September today. The index came in at 98.8, narrowly missing the forecast of 98.9, which is still a little lower than last month’s level.
On the other hand, both business and consumer confidence reports from Italy were better than expected in September.
Later today we expect a series of speeches by Federal Reserve board members, including Chair Jerome Powell.
Meanwhile, China still remains in the focus of investors’ attention. Developer Evergrande missed a deadline on its bond payments yesterday, which is considered a default, though now the company has 30 days to still try and make those payments. If that doesn’t happen (and it doesn’t seem likely that it would), the default will be official.
Evergrande stock moved down by another 11% today, dragging Chinese and European stock indices in its wake.
US stock indices will also trade lower today, largely because of the way Chinese markets are performing, but also because of the Fed’s most recent meeting, which caused a spike in US Treasury bond yields yesterday.
Companies to keep an eye on today include Nike, Adidas, and Puma, as their supply chains might be interrupted due to coronavirus restrictions in Vietnam.
At the same time, another crisis is in the making in the United Kingdom. The country is preparing to experience shortages of food and other supplies due to the lower availability of truck drivers. Due to Brexit, the United Kingdom has lost a huge chunk of its low-skill labor, an issue especially pronounced in the logistics field.
