The ECB raised interest rates further – We show the stock market reactions

The most important American stock markets closed the day with a rise: the Dow Jones gained almost 1%, the S&P and the Nasdaq gained a little more than 0.8%.

The leading American stock indexes are having a good day: the Dow Jones is up almost 1%, the S&P and the Nasdaq are up a little over 0.8%.

Before the market close, the French CAC 1 and the German DAX are already up 0.7 percent.

With the strengthening of the dollar, gold came under pressure again, and the quotation is currently hovering around the $1,900 level.

After the opening, the Dow and S&P 500 are both up 0.5 percent, and the Nasdaq is up 0.4 percent.

The DAX is up by 0.3 and the CAC is already up by 0.4 percent.

After the data dumping in the afternoon, there is a prospect of a restrained rise on the American stock markets, the S&P 500 may open by 0.3 percent, and the Dow and the Nasdaq may both open with a gain of 0.2 percent.

Against the dollar, the euro has already weakened below 1.067 levels, after the latest producer price index (PPI) data was published in America at the same time as the ECB’s interest rate hike.

Compared to the expected 0.4 percent, the increase in producer prices was 0.7 percent in August.

At the same time, retail trade data arrived, also from America, and the turnover in August increased by 0.6 percent, which is well above the preliminary expectations of a 0.1 percent increase.

After the 25 basis point increase, the exchange rate spiked all the way to the 1.075 level, but a few minutes later, the EUR/USD was moving close to the 1.07 level.

Although the increase can be said to be a bit of a surprise, especially taking into account the economic data coming from the euro area, the main reason behind the weakening of the euro is that, according to the Governing Council, the key interest rates of the ECB have reached levels which, if maintained for a sufficiently long period of time, will significantly contribute to inflation should return to the target in time.

Based on this, it is likely that today was the last interest rate hike during the current tightening cycle.

The Hungarian stock market is already up 0.7 percent in the afternoon.

Among domestic blue chips, OTP leads the rise. After they were down 1.2 percent after opening in the morning, by the afternoon the bank’s papers were already up nearly 1 percent.

After a small fall in the morning, the German DAX and the French CAC stock indexes are already hovering around their closing value yesterday.

Among the leading European stock indices, the German DAX is down 0.3 percent and the French CAC is down 0.4 percent before the ECB’s interest rate decision in the afternoon.

In the first hour of trading, BUX fell by about 0.7 percent.

The domestic blue chips are also in the red, with the exception of Magyar Telekom, OTP’s shares fell the most so far, nearly 1.2 percent.

European stock markets mostly fell after the opening, the DAX fell by 0.1 percent, while the CAC weakened by 0.2 percent and the FTSE 100 gained 0.2 percent. The Milan stock exchange also fell by 0.5 percent, while the Spanish stock market fell by 0.1 percent.

What are the current events on the stock exchanges?

• The leading American stock indexes closed mixed yesterday, the Dow Jones was down 0.2 percent, the S&P 500 closed up 0.1 percent, while the Nasdaq rose 0.4 percent.
• The Asian stock markets are showing an increase this morning, the Nikkei is up 0.86 percent, the Hang Seng is up 0.19 percent, while the CSI 300 is up 0.74 percent.
• The European stock markets may open in a good mood, based on the future stock indices, the DAX may rise by 0.37 percent, the CAC may rise by 0.02 percent, while the FTSE may open with an increase of 1.22 percent.
• The American futures stock indexes are forecasting a rise at the market opening, the Dow Jones may rise by 0.19 percent, the S&P 500 may open with a gain of 0.28 percent, while the Nasdaq may rise by 0.44 percent.

What can be expected on the macro front?

The MNB’s preliminary statistical balance will be published this morning, but the ECB’s interest rate decision in the early afternoon may be more important than that. The market is cautiously watching what the central bank of the Eurozone will do, since the next interest rate increase cannot be taken for granted based on the communication so far, and the decision-makers seem to be divided. The decision may cause serious fluctuations in the foreign exchange market, primarily in the exchange rate of the euro, but it may also indirectly affect the forint. Meanwhile, in America, retail data will also come out at the same time as the interest rate decision.

What has happened on the stock markets so far?

• Among the leading American, Asian, European and regional stock indexes this year, the Nasdaq index is at the top with a 40.3 percent shift, the Hang Seng index is the driving force with a 9.0 percent fall.
• Among domestic blue chips this year, OTP’s share performed best with a 43.5 percent increase, and Mol’s paper is at the bottom of the list with a 4.1 percent increase.
• Among the most important raw materials, the price of WTI has risen by 10.3 percent since the beginning of the year.

Cover image source: Getty Images