Original title: The Jackson Hole Central Bank Annual Meeting Is Coming! Will Wall Street still be able to attack this week? Be wary of sudden turmoil
Source: FX168
On Monday (August 23), the Asia-Pacific stock market rebounded, and Hong Kong's Hang Seng Index rose after falling into a bear market last week. As of today's closing, Hong Kong's Hang Seng Index closed up 1.05%, the Hang Seng Technology Index rose 2.14%, and the pharmaceutical and precious metals sectors led the way. Ganfeng Lithium and Pharmaceutical Biotech rose more than 7%.
Following the Asia-Pacific stock market, the European stock market opened up sharply today and is expected to rebound after recording the worst weekly performance since February. CNBC pointed out that the European stock market has escaped its biggest weekly decline since February, and traders are concerned about issues such as global monetary policy and the Delta epidemic.
In response to this week's Wall Street outlook, Reuters reports that investors are preparing for future market turmoil because concerns about slowing growth, the Fed's imminent reduction in loose monetary policy, and the resurgence of the global COVID-19 pandemic threaten this round of rebound.
Although the US stock market is still hovering near record highs, investors still need to be cautious:Goldman SachsAnalysts recently lowered their estimates of US economic growth in the third quarter from 9% to 5.5% due to the impact of the Delta variant virus.
Also, acceptBank of AmericaFund managers surveyed by the Global Research Department said they raised the level of cash overallocation to the highest level since October 2020, while increasing positions in defense stocks such as healthcare and utilities.
Investors' main concerns include the possibility that the Federal Reserve may begin to withdraw economic support measures in the face of stronger inflation than expected, just as economic growth begins to decline and the Delta variant strain threatens the reopening of all parts of the United States.
U.S. Rob Haworth, senior investment strategy director at Bank Wealth Management, said, “The Federal Reserve has been providing huge monetary support to the economy for a while, so the market is fearful about the Fed's reduction in debt purchases and what impact this will have on growth.”
Investors will be watching this week's central bank seminar in Jackson Hole, Wyoming, for clues about when the Federal Reserve will begin to slow its $120 billion monthly debt purchases. Federal Reserve Chairman Powell is scheduled to deliver the keynote speech at 10 a.m. local time on the 27th.
BofA Global Research analysts earlier advanced the expected time for the Federal Reserve to begin reducing debt purchases from January to November as previously predicted, believing that the minutes of the Federal Reserve's most recent policy meeting released on Wednesday suggest that it is more likely that support will begin to be withdrawn this year.