Welcome to a preview of the upcoming day in European and global markets, brought to you by Ankur Banerjee.
Following the Bank of Canada’s decision to cut interest rates, all eyes are now on the European Central Bank as anticipation grows for a potential rate cut. President Christine Lagarde holds the key to what lies ahead in the market.
While the ECB has signaled its plan to reduce borrowing costs, uncertainties loom over the future trajectory, especially with recent data suggesting inflation may be more persistent than initially anticipated in both Europe and the United States.
The focus now shifts to Lagarde’s post-rate-cut remarks to gauge the market’s response. Traders have already priced in the expectation of 64 basis points of cuts for the year.
Preceding the policy announcement, the euro showed strength, hovering just below recent highs. Futures for European markets indicate a positive start, following the lead of U.S. and Asian stocks amid growing expectations of a Fed rate cut in September.
With a 69% chance of a September rate cut according to traders, all eyes are on the upcoming U.S. non-farm payrolls report that could further influence market sentiment.
Chip stocks are riding high on the success of Nvidia, now the world’s second-most valuable company. Nvidia’s CEO, Jensen Huang, is receiving star treatment in Taiwan, boosting the local stock market which is hitting record highs fueled by companies like TSMC.
Key events to watch on Thursday include the ECB policy meeting and euro zone retail sales for April.
Stay tuned for market updates and analysis by Ankur Banerjee. Edited by Jacqueline Wong.