Breaking News
Get 40% Off 0
Is NVDA a 🟢 buy or 🔴 sell? Unlock Now

Stocks, Gold Rally After Jackson Hole

By CMC Markets (Jasper Lawler)Market OverviewAug 28, 2016 09:32
uk.investing.com/analysis/markets-unconvinced-about-hike-after-jackson-hole--stocks,-gold-rally-200150384
Stocks, Gold Rally After Jackson Hole
By CMC Markets (Jasper Lawler)   |  Aug 28, 2016 09:32
Saved. See Saved Items.
This article has already been saved in your Saved Items
 
 
EUR/USD
-0.02%
Add to/Remove from a Portfolio
Add to Watchlist
Add Position

Position added successfully to:

Please name your holdings portfolio
 
GBP/USD
+0.09%
Add to/Remove from a Portfolio
Add to Watchlist
Add Position

Position added successfully to:

Please name your holdings portfolio
 
UK100
+0.28%
Add to/Remove from a Portfolio
Add to Watchlist
Add Position

Position added successfully to:

Please name your holdings portfolio
 
XAU/USD
+0.55%
Add to/Remove from a Portfolio
Add to Watchlist
Add Position

Position added successfully to:

Please name your holdings portfolio
 
XAG/USD
+0.90%
Add to/Remove from a Portfolio
Add to Watchlist
Add Position

Position added successfully to:

Please name your holdings portfolio
 
VIV
-0.39%
Add to/Remove from a Portfolio
Add to Watchlist
Add Position

Position added successfully to:

Please name your holdings portfolio
 

European stocks spent most of the day just in the negative, only to turn positive in the afternoon following an unconvincing signal from Federal Reserve Chair Janet Yellen that US rates will rise sometime this year.

Thin holiday trading and nerves ahead of the highly-anticipated speech from the US central banker kept markets at bay for most of the day. The speech itself was always going to struggle to live up to the hype. In the end, Janet Yellen’s words followed a familiar path of non-committal ambiguity.

Traders spent most of the day in “wait-for-Janet” mode. With such distortions from the protracted period of low interest rates and central bank bond-buying, any chance of a major update on monetary policy brings markets to a standstill.

A reported profit drop at French media giant Vivendi (PA:VIV) coupled with its ongoing spat with Mediaset had kept European benchmarks at bay, but a strong open on Wall Street improved sentiment.

Healthcare stocks were the biggest drag on the FTSE 100 for the second-day running, with Shire (LON:SHP) and AstraZeneca (LON:AZN) falling over 1%. Investors are pulling funds from what now seems to be one of the most politically-sensitive industries in the run up to the US presidential election.

A slide in the US dollar and a broad rally in commodities including oil, gold and copper carried basic resource shares to the top of the UK benchmark.

Stocks in the US look to extend a higher open following Janet Yellen’s speech at the Jackson Hole symposium.

FX

A reference in Janet Yellen’s speech to the “possibility of purchasing a broader range of assets” caused a sharp reversal of initial gains in the US dollar. The dollar had risen when the speech was first released on the headline that the “rate-hike case has strengthened in recent months.”

The whipsaw movement in dollar currency pairs like EUR/USD was exacerbated by interviews from other Fed members which displayed a divided set of opinions.

The British pound saw a brief spike following data confirming UK GDP rose 0.6% q/q (2.2% y/y) with a 0.5% rise in business investment. Sterling had seen a slight uplift beforehand from survey data showing consumer confidence rebounded from post-Brexit jitters according to YouGov/CEBR.

A preliminary estimate of French GDP confirming second quarter stagnation (0% growth q/q), unchanged from the flash estimate had minimal impact on the euro or European indices.

Commodities

The weak dollar after Fed Chair Yellen’s Jackson Hole speech set a fire under commodities. Gold, oil and copper all rose since the likelihood of a US rate hike this year appears to have improved but the expected path of rate hikes diminished. While interest rate remain low and stock markets have high valuations, gold and silver remain attractive hedging options.

Disclaimer: CMC Markets is an execution only provider. The material (whether or not it states any opinions) is for general information purposes only, and does not take into account your personal circumstances or objectives. Nothing in this material is (or should be considered to be) financial, investment or other advice on which reliance should be placed.

No opinion given in the material constitutes a recommendation by CMC Markets or the author that any particular investment, security, transaction or investment strategy is suitable for any specific person.

Original post

Stocks, Gold Rally After Jackson Hole
 

Related Articles

Stocks, Gold Rally After Jackson Hole

Add a Comment

Comment Guidelines

We encourage you to use comments to engage with users, share your perspective and ask questions of authors and each other. However, in order to maintain the high level of discourse we’ve all come to value and expect, please keep the following criteria in mind: 

  • Enrich the conversation
  • Stay focused and on track. Only post material that’s relevant to the topic being discussed.
  • Be respectful. Even negative opinions can be framed positively and diplomatically.
  •  Use standard writing style. Include punctuation and upper and lower cases.
  • NOTE: Spam and/or promotional messages and links within a comment will be removed
  • Avoid profanity, slander or personal attacks directed at an author or another user.
  • Don’t Monopolize the Conversation. We appreciate passion and conviction, but we also believe strongly in giving everyone a chance to air their thoughts. Therefore, in addition to civil interaction, we expect commenters to offer their opinions succinctly and thoughtfully, but not so repeatedly that others are annoyed or offended. If we receive complaints about individuals who take over a thread or forum, we reserve the right to ban them from the site, without recourse.
  • Only English comments will be allowed.

Perpetrators of spam or abuse will be deleted from the site and prohibited from future registration at Investing.com’s discretion.

Write your thoughts here
 
Are you sure you want to delete this chart?
 
Post
Post also to:
 
Replace the attached chart with a new chart ?
1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Thanks for your comment. Please note that all comments are pending until approved by our moderators. It may therefore take some time before it appears on our website.
 
Are you sure you want to delete this chart?
 
Post
 
Replace the attached chart with a new chart ?
1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Add Chart to Comment
Confirm Block

Are you sure you want to block %USER_NAME%?

By doing so, you and %USER_NAME% will not be able to see any of each other's Investing.com's posts.

%USER_NAME% was successfully added to your Block List

Since you’ve just unblocked this person, you must wait 48 hours before renewing the block.

Report this comment

I feel that this comment is:

Comment flagged

Thank You!

Your report has been sent to our moderators for review
Continue with Google
or
Sign up with Email