(News Bulletin 247) – Wall Street is expected to start higher on Friday morning as investors return to buying equities minutes away from a long-awaited intervention by Jerome Powell.
Half an hour before the opening, the futures contracts on the main New York indices advance from 0.2% to 0.5%, suggesting a small increase at the opening.
In the absence of major indicators, the main indices are supported by technical elements after their heavy decline the day before, which had notably led the Nasdaq to drop more than 1.5%.
Since the beginning of the week, trading volumes have been particularly weak, a sign that investors are reluctant to commit, for lack of information on the intentions of the American central bank.
Nvidia’s much better than expected earnings release was not much support, nor was the recent ebb in US bond yields which continues this morning.
Market participants should limit their activity, however, in view of the speech scheduled for the morning of Jerome Powell, the chairman of the Federal Reserve, at the Jackson Hole symposium.
Given the obvious deterioration in the economic situation in China and Europe, investors are waiting to be reassured about the Fed’s intentions in terms of interest rates.
The problem is that the labor market and inflation are not slowing as fast as US central bank officials would like.
“This means that it is not unthinkable to envisage the Fed not only maintaining its status quo, but announcing further rate hikes next year,” warns Tiffany Wilding, economist at PIMCO.
Traders generally expect Jerome Powell to reaffirm his view that the evolution of monetary policy will remain dependent on published statistical data.
The Fed Chairman’s hearing will begin at 10:00 a.m. (New York time).
At the same time, the Michigan consumer confidence index will be published, which should confirm the resilience of US household morale.
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