S&P 500 — US Large Cap Index
FTSE 100 — UK Blue Chips
Euro Stoxx 50 — Eurozone Leaders
DAX 40 — German Equities
CAC 40 — French Market Index
Nikkei 225 — Japan Benchmark
Hang Seng — Hong Kong Index
Shanghai Composite — China Mainland
ASX 200 — Australian Market
TSX Composite — Canada Index
Nifty 50 — India Large Cap
STI Index — Singapore Market
KOSPI — South Korea Index
Bovespa — Brazil Equities
JSE Top 40 — South Africa Index
IPC Index — Mexico Market
Danske Research Team notes that EUR/USD has modestly rebounded above 1.16 following recent Dollar strength after Fed Chair Kevin Warsh’s Jackson Hole speech. They also highlight contained underlying inflation pressures across major euro-area economies, while markets await the region’s flash inflation, unemployment and final manufacturing PMI data.
Pair recovers above 1.16 level
“In the euro area, we receive the flash inflation data for August. National releases from France and Spain were broadly as expected in headline terms, while the German print came in slightly lower than expected.”
“In Germany, HICP inflation increased to 2.9% y/y in August (cons: 3.1%, prior: 2.8%), slightly below expectations. The details showed higher energy and core goods inflation, while services and food inflation declined, leaving core CPI unchanged at 2.4% y/y. “
“Goods prices increased strongly for the second consecutive month, suggesting we are starting to see some indirect effects from higher energy prices, but services momentum remained very low at 0.15% m/m s.a. Overall, core inflation momentum is still contained at 2.5% 3m/3m SAAR, indicating that energy prices are not transmitting broadly to underlying inflation – similar to the picture in France and Spain last week.”
“Importantly, underlying inflation pressures remained contained across the three countries: core inflation either declined or was unchanged with a continued muted momentum. This suggests that the energy price shock has not yet spilled over to underlying inflation. We therefore expect headline inflation to rise to 3.2% y/y, while core inflation should decline to 2.4% y/y.”
“In the currency market there was a modest rebound in the EURUSD, which is back above 1.16, while USDJPY moved below 160 after the strengthening of the dollar on the back Fed Chairman Warsh’s speech on Friday at the conference at Jackson Hole.”
“Also from the euro area, we get data on unemployment which is expected to stay at 6.3% and the final manufacturing PMI for August that is expected to confirm the flash release of 52.8.”
