SHANGHAI, Sep 14 (SMM) — This is a roundup of global macroeconomic news last night and what is expected today.
The dollar was poised for its first back-to-back weekly gains since May on Friday as jitters in equity markets had investors sticking to safer assets, while sterling tracked toward its worst week since March on fears of a messy hard Brexit.
The European Union told Britain on Thursday it should urgently scrap a plan to break their divorce treaty. But Britain has refused to budge and pressed ahead with a draft law that could sink four years of Brexit talks by fiddling with agreed-upon arrangements for Northern Ireland.
Shares of Japan’s Softbank Group soared Monday morning following an announcement that the firm is set to sell UK chip designer Arm to US chip firm Nvidia. Chipmaker Nvidia has agreed to buy Arm Holdings, a designer of chips for mobile phones, from Softbank in a deal worth $40 billion, the companies announced Sunday. The deal will be for a mix of $21.5 billion in Nvidia stock and $12 billion in cash, including $2 billion payable at signing.
On Wall Street, US stocks rose in another volatile session on Friday as tech once again attempted to rebound from its recent slump. The Dow Jones Industrial Average traded 190 points higher, or 0.7%. The S&P 500 climbed 0.4% while the Nasdaq Composite was flat.
Oil prices edged higher on Friday as equities markets firmed, but crude remained on track for a second weekly drop as investors expected a global glut to persist if demand weakens further with rising COVID-19 cases in some countries.
In the United States, crude stockpiles rose last week, against expectations, as refineries slowly returned to operations after production sites were shut down due to storms in the Gulf of Mexico and the wider region.
Gold slipped on Friday on a lack of further stimulus from the European Central Bank and the US government, but for the week the safe-haven metal was set to end higher on concerns over an economic recovery.
ECB President Christine Lagarde on Thursday refrained from signaling that the bank would expand stimulus, while, the US Senate blocked a Republican bill for new coronavirus aid. “We are transitioning into a post-COVID type of environment. That means we’re not going to be pumping out the same stimulus, that signals to the market that things are going to be a little different going forward,” said Daniel Pavilonis, senior market strategist at RJO Futures.
On the data front, the UK economy grew 6.6% in July on a monthly basis, according to initial estimates published Friday, as the economy seeks to recover from the sharp downturn caused by coronavirus-induced lockdown measures.
In Germany, consumer prices fell by 0.1%, following a 0.5% slide in July, with the harmonized consumer price index falling by 0.2%. In July, the HICP had fallen by 0.5%.
From Spain, consumer prices fell by 0.5% year-on-year, following a 0.6% decline in July. The harmonized consumer price index fell by 0.6%, following a 0.7% decline in July.
From the US, core consumer prices rose by 0.4% in August, following a 0.6% increase in July. Economists had forecast a 0.2% rise. The rise in core consumer prices supported a pickup in core inflationary pressures. In August, the annual rate of core inflation picked up from 1.6% to 1.7%. The annual rate of inflation also picked up in August, rising from 1.0% to 1.3%. Consumer prices rose by 0.4% in the month, following a 0.6% increase in July. Economists had forecast a 0.3% rise.
China's new yuan-denominated loans hit 1.28 trillion yuan (about 187.13 billion US dollars) in August, a year-on-year increase of 69.4 billion yuan, the central bank data showed Friday. Newly-added social financing, a measurement of funds the real economy receives from the financial system, came in at 3.58 trillion yuan in August, up 1.39 trillion yuan year on year. By the end of August, total social financing reached 276.74 trillion yuan, up 13.3 percent year on year.
Investors are now awaiting the US Federal Reserve’s policy meeting on September 15-16.
July industrial production figures for the Eurozone and China’s house prices data for August are set for release today.