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Equities Analysis & News
- Focus on taper talks at the Jackson Hole Symposium
- Equities to remain sensitive despite expectations being almost certain
- Key levels to watch in the DAX 30[1] and S&P 500[2]
TAPER TALKS AND JACKSON HOLE
Global equities have been left licking their wounds this week as various external influences have made sentiment sour slightly after what has been an impressive run for stocks over the last few months. There is so much going on in the world at the moment that investors may be left a little confused as to what has been driving market sentiment in recent sessions.
One of the main sticking points is the ongoing spread of the Delta strain across the world, with a significant rise detected in places like the US, China, and Australia. It seems that even with high vaccination rates the virus is still highly infectious, which puts into question the feasibility of a return to normalcy anytime soon, and with that full economic recovery.
But stocks had been holding up remarkably well up until this week, when the Federal Reserve released its meeting minutes from its latest meeting in July, signaling that tapering of asset purchases was now being considered. There is no real surprise in that as economists had been predicting this move for months, but I guess an official acknowledgment from the Fed makes it just that little bit scarier, or that’s what may economists have been sourcing as the main reason for the equity selloff. But if you look at bond markets, yields have continued to pullback this week, which kind of contradicts the response you would expect after the Fed acknowledges tapering, its first step in unwinding its ultra-loose monetary policy.
So this reaction
