On Thursday, Eastern Time, US stocks are closed for Thanksgiving, and will close 3 hours early on Friday (close at 02:00 on November 27, Beijing time). On Wednesday, the three major US stock indexes were mixed. In Europe, on Thursday, local time, the major indexes of European stocks collectively rose.
According to data released by the U.S. Department of Labor on Wednesday, as of the week of November 20, the number of initial jobless claims after seasonal adjustments was 199,000, the lowest level since 1969. If this level continues, it will become The next milestone in the uneven recovery of the job market. The U.S. property market continues to have a “high fever”. In October, housing prices hit a record high again. While prices continue to soar, the U.S. is staged a “housing rush”. At the same time, the minutes of the Fed meeting show that if inflation continues to be high, it should be prepared to raise interest rates in advance.
In Europe, the epidemic has returned, and the German business confidence index has fallen for five consecutive months. Holzmann, a member of the European Central Bank Management Committee, said that after the end of PEPP next year, it is still expected to restart if necessary.
High stock market volatility
On Wednesday, Eastern Time, U.S. stocks continued to oscillate and adjust near record highs. The three major indexes were mixed. As of the close, the Dow fell 9.42 points, or 0.03%, to 35,804.38; the Nasdaq rose 70.09 points, or 0.44%, to 15,845.23. Points; the S&P 500 index rose 10.76 points, or 0.23%, to 4,701.46 points. The U.S. stock market will be closed for Thanksgiving Day on November 25 (Thursday) and will close 3 hours earlier on November 26 (Friday), that is, the market will close at 02:00 on November 27, Beijing time.
European stocks are trading normally. On Thursday, local time, the major indexes collectively rose. As of the close, the UK FTSE 100 index closed at 7,30.37 points, up 24.05 points or 0.33% from the previous trading day; the French CAC40 index closed at 7075.87 The German DAX30 index closed at 15,917.98 points, up by 33.64 points, or 0.48%, from the previous trading day, up 39.59 points, or 0.25%, from the previous trading day.
Recently, the U.S. dollar has strengthened, and the U.S. dollar index once hit the 97 mark. Affected by the strong U.S. dollar, oil prices and gold prices have seen a significant correction recently. On Thursday, European time, international oil prices continued to fall slightly. As of the close of trading, the US oil January contract closed down 0.36 US dollars, or 0.46%, to 78.03 US dollars per barrel. Brent’s January crude oil futures closed down 0.03 US dollars, or 0.03%, to 82.22 US dollars per barrel. International gold prices rebounded slightly. As of the close, the December gold futures price on the New York Mercantile Exchange gold futures market, the most actively traded, rose 4 US dollars from the previous trading day to close at 1,788.3 US dollars per ounce, an increase of 0.22%.
Expected to raise interest rates earlier
According to data released by the US Department of Labor on Wednesday, as of the week of November 20, the number of initial jobless claims after seasonal adjustments was 199 thousand, which is expected to be 260,000, and the previous value was 26.8 million. This data is the lowest level since 1969. As of November 13, the number of people in the United States who continued to claim unemployment benefits was 2.049 million, which is expected to be 2.033 million, and the previous value was 2.08 million.
At the end of February 2020 before the outbreak of the new crown pneumonia in the United States, the number of initial jobless claims was 216,000. By the beginning of April 2020, the number of applicants reached a peak of 6.1 million. Since then, as the economy has reopened more broadly and Americans have returned to work, the number of applicants has declined.
According to the latest data from the National Association of Realtors, in October 2021, the median sale price of existing homes in the United States rose by 13.10% from the same period in 2020, reaching a record high of US$353,900. This is of course related to the Fed’s epic release. Since the outbreak of the new crown epidemic, the Fed’s monetary easing policy has been the most aggressive. The benchmark interest rate has been continuously reduced to a level close to zero, and “unlimited” asset purchases have been initiated. As of the end of October 2021, the Fed has cumulatively expanded its balance sheet by more than US$4 trillion. .
However, this epic-level release may have come to an end. The Fed’s November minutes showed that although officials at the meeting judged that inflation continued to rise mainly reflected some temporary factors, they also said that the inflationary pressure itself may take longer than the Fed expected to subside. Many participants pointed out that if inflation continues to be higher than the committee’s policy goals, the FOMC should be prepared to adjust the speed of Taper, while adjusting the target range of the federal funds rate earlier than expected. Participants said that the FOMC should not hesitate to take appropriate measures in response to inflationary pressures that threaten long-term price stability and employment targets. The US dollar has recently risen strongly, once approaching the 97 mark, which reflects this expectation to a large extent.
Of course, there are also different opinions in the market. Everbright Macro’s Gao Ruidong team released a research report predicting that, given that the Fed is still focusing on “preserving the economy” as its main policy goal, accelerating monetary policy tightening is a small probability event, and maintaining the judgment that interest rates will be raised no earlier than 2023.
With the approach of a new wave of epidemics, the European economy is facing threats again. Eurozone “locomotive” Germany’s IFO business climate index in November recorded 96.50, a decline for the fifth consecutive month, the lowest level since April. Economists had expected the index to fall to 96.70, and expectations for the next six months have also deteriorated. The German November Purchasing Managers Index PMI released on Tuesday local time showed that unprecedented inflationary pressures may curb output in the coming months.
The Bundesbank warned this week that the inflation rate in November may be close to 6% and may remain high for a longer period of time. In addition, the new epidemic restriction measures may put pressure on demand in the service industry, which has been an important driving force for economic recovery.
The European Central Bank plans to end the 1.85 trillion euro emergency bond purchase program (PEPP) net purchases in March next year. However, Holzmann, a member of the European Central Bank Management Committee, said that after the end of PEPP next year, it is still expected to restart if necessary. Holzmann claims that this will be to retain the advantage of flexibility for use in the event of an economic shock. Although it is not hoped that it will come in handy, economic shocks are likely to occur.
After the number of people infected with new crown pneumonia in some euro area countries has surged, threatening economic recovery, the economic outlook is full of uncertainties. At the same time, euro area inflation is at its highest level since 2008 and may accelerate further, which gives policy The framers have brought pressure to reconsider their easing policy stance.
In a few weeks, ECB officials will meet to decide how to end the unconventional epidemic stimulus measures. Many policymakers, including Isabel Schnabel, warned that inflation has upside risks and that monetary policy must be able to respond quickly to changes in the economic outlook.
To deal with inflation, and to consider the impact of a new round of the epidemic, all of this can be used to describe the European monetary policy-entanglement.