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

It was a good day for the US stock markets

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%.

DowJones 20230914 close

American stock markets continue to rise

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%.

DowJones 20230914evening

The continent’s leading stock exchanges continue to gain momentum even before the close

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


Gold is under pressure

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


America on the rise

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


The leading European stock markets are rising

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


America may open with a small gain

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.

Half the numbers came from America

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.


The ECB raised, the euro falls

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.


BUX is getting better and better

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

boxwoodAmong 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.

The continent’s leading stock exchanges are holding on

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


The leading stock exchanges await the ECB’s decision in the red

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.


The Hungarian stock market is falling

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.


A weak start in Europe

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.


European stock markets can open in a good mood

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.

September 11-17, 2023 macro calendar
Hungarian macroeconomics
September11.Monday8:30 a.mMNBGolden book2022
September12.Tuesday11:30 a.mAKK3-month dkj auction
September13.Wednesday8:30 a.mKSHIndustry (detailed)July
September14.Thursday8:30 a.mMNBPreliminary statistical balance sheet of the MNBaug.
September15.Friday8:30 a.mKSHBuilding industryJuly
International macroeconomics
September12.Tuesday11:00 a.mEUZEW sentiment indexSept.
September13.Wednesday8:00 a.mUKIndustryJuly
September13.Wednesday11:00 a.mEUIndustryJuly
September13.Wednesday2:30 p.mUSAInflationaug.
September14.Thursday2:15 p.mEUECB interest rate decision
September14.Thursday2:45 p.mEUChristine Lagarde’s press secretary
September14.Thursday2:30 p.mUSAIndustrial producer pricesaug.
September14.Thursday2:30 p.mUSARetail tradeaug.
September15.Friday4:00 a.mChinaIndustryaug.
September15.Friday4:00 a.mChinaRetail tradeaug.
September15.Friday11:00 a.mEUForeign tradeJuly
September15.Friday4:00 p.mUSAMichigan Consumer SentimentSept.
Source: Portfolio collection

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.
More important instruments
Exchange rateOne day1 week1 monthThis year1 year5 years
US stock indices
Dow Jones34,575.53-0.2%0.4%-2.0%4.3%11.2%32.2%
S&P 5004,467.440.1%0.0%0.1%16.4%13.6%53.8%
Asian stock indices
Hang Seng18,009.22-0.1%-2.4%-5.6%-9.0%-6.8%-33.3%
CSI 3003,736.65-0.6%-2.0%-3.8%-3.5%-9.1%15.5%
European stock indices
FTSE MIB28,481.77-0.4%1.0%0.7%20.1%27.7%36.6%
Regional stock indices
BUX57 191.42-0.2%2.3%1.9%30.6%37.6%58.2%
ATX3 145.71-0.6%-0.9%0.0%0.6%5.0%-4.9%
Hungarian blue chips
Mol2 7080.1%1.8%1.4%4.1%0.8%-5.3%
Magyar Telekom4741.1%5.3%7.8%39.8%51.9%17.0%
Raw materials
Foreign currencies
Government papers
10-year US Treasury yield4.25-0.3%-1.0%1.8%10.9%24.2%43.0%
10-year German government bond yield2.630.5%-0.2%1.3%2.5%52.1%517.9%
10-year Hungarian government bond yield7.080.3%-3.1%-5.3%-23.5%-22.1%93.4%
Source: Refinitiv, Portfolio

Cover image source: Getty Images