Global share marketsWhile the commodity prices, which reached record levels, moved in an upward trend, albeit limited, with the US debt ceiling crisis and mixed labor market data, the eyes were turned to the meeting minutes of the US Federal Reserve (Fed) and inflation data next week.
The effects of the disrupted supply chain on asset prices continue to be seen after the new type of coronavirus (Covid-19) epidemic.
In the week in which the November futures natural gas contract in Europe broke a record by rising to 162 euros, it closed the week with a 7.6 percent depreciation at 87.6 euros, with statements from Russia and European Union officials.
While the aforementioned fluctuations raised questions regarding the natural gas supply in Europe, Brent oil’s barrel price increased in November after the Organization of Petroleum Exporting Countries (OPEC) and the OPEC+ group, which consists of some non-OPEC producer countries, left the increase in production at 400 thousand barrels per day in November, contrary to market expectations. The price closed the seventh week in a row with value gains. The barrel price of Brent oil rose 4.1 percent week on week to $82.2 dollars.
On the other hand, after the negotiations that continued throughout the week, the Democrats and Republicans in the US Senate reached an agreement to increase the country’s debt limit for a short time, which supported the stock markets.
The non-farm employment data announced in the USA, which was well below the expectations, brought about volatility in asset prices. While the fluctuations in the ounce price of gold increased after the data, the 10-year bond yield of the US rose to 1.6150 percent.
With these developments, the global stock markets followed a buying trend, albeit limited, while the US 10-year bond yield ended the week at 1.60 percent with an increase of 14 basis points.
While the volatility in the ounce price of gold increased after the non-farm employment data in the USA, it decreased to $ 1,758 with a weekly depreciation of 0.1 percent.
In the USA, eyes turned to Fed and inflation data
While increasing the debt limit was the focus of the agenda throughout the week in the USA, the said limit was increased for a short time. Next week, the Fed’s Federal Open Market Committee (FOMC) meeting minutes and Consumer Price Index (CPI) data are in the focus of investors, as they may give clues about reducing asset purchases.
US Senate Majority Leader Democrat Chuck Schumer announced that they have agreed to increase the Treasury Department’s borrowing authority until the beginning of December, preventing the country from defaulting. With the agreement, it was reported that the debt limit will be increased by 480 billion dollars, which will be sufficient until 3 December.
US Treasury Secretary Janet Yellen stated that we are “on the verge of a historic agreement” on the global minimum corporate tax, and that the agreement will be completed in the coming weeks.
According to the macroeconomic data announced in the USA, non-farm employment increased by 194 thousand people in September, while the unemployment rate fell to 4.8 percent.
Private sector employment increased by 568 thousand in September, rising above expectations, while the Supply Management Institute (ISM) non-manufacturing index increased by 0.2 points month-on-month to 61.9 in September, surpassing market expectations.
Analysts noted that the FOMC meeting minutes and CPI data to be announced in the USA may clarify the roadmap for monetary policy, and stated that the minutes and data may increase volatility.
With these developments, the S&P 500 index gained 0.79 percent on a weekly basis, the Nasdaq index gained 0.09 percent and the Dow Jones index gained 1.22 percent.
In the data calendar of the week that started with October 11, Wednesday’s CPI and Fed’s meeting minutes, Thursday’s weekly jobless claims and Producer Price Index (PPI) and Friday’s New York Fed industrial index, retail sales and Michigan Consumer Confidence Index data will be followed.
Natural gas on the agenda in Europe
Problems related to natural gas supply in Europe remain at the center of the agenda.
Natural gas futures, which went up to 162 euros during the week, increased the inflation pressures in Europe and brought questions about the security of energy supply.
Ursula von der Leyen, President of the European Union (EU) Commission, stated in her statement on the subject that natural gas suppliers, who did not increase production despite the demand, are responsible for the recently increased energy prices, and said that they will accelerate their efforts to become more independent in energy.
Russian President Vladimir Putin, on the other hand, stated that it is more profitable for Gazprom to deliver gas to Europe via other lines instead of Ukraine. required.” said.
Russian Deputy Prime Minister Alexander Novak said certification of the Nord Stream 2 subsea gas pipeline to Germany could help cool rising gas prices in Europe.
Natural gas futures, which started to decline after the aforementioned statements, closed the week at 87.6 euros.
In the minutes of the European Central Bank’s (ECB) monetary policy meeting in September, some members stated that the markets were ready for the end of support under the Pandemic Emergency Asset Purchase Program (PEPP) and emphasized a greater cut in asset purchases.
In the data calendar, factory orders in Germany fell by 7.7 percent month-on-month, well below expectations, while industrial production fell by 4 percent, failing to meet market forecasts.
The euro, on the other hand, continued to depreciate against the dollar and carried its downward trend for the fifth week in a row, reaching its lowest level since July 2020 with 1.1530. The pair fell 0.16 percent weekly to 1.1575.
This week, the DAX index in Germany gained 0.33 percent, the FTSE 100 index in the UK by 0.97 percent, the CAC 40 index in France by 0.65 percent and the MIB 30 index in Italy by 1.70 percent.
Next week, Zew expectation index in Germany on Tuesday, industrial production in England and Euro Area on Wednesday, CPI in Germany and foreign trade balance data in the Euro Area on Friday will be followed.
A mixed trend was observed in Asia.
In Asia, developments in the supply chain and risks posed by real estate companies in China adversely affected the equity markets, while the Chinese stock market, which was traded only on Friday, was lucrative as the problems partially subsided on the last trading day of the week.
While the Chinese real estate giant Evergrande continued to fail to make its bond payments, the selling pressure in the equity markets got stronger with the participation of Fantasia Holding in Evergrande.
While the results of the survey in Japan revealed that the public support for the new Prime Minister Kishida Fumio and his cabinet was 55.7 percent, the moderate support compared to the previous prime ministers increased the importance of the pre-election developments.
With these developments, Shanghai composite index gained 0.67 percent in China and Hang Seng index gained 1.07 percent in Hong Kong on a weekly basis, while Nikkei 225 index in Japan increased by 2.51 percent and Kospi index in South Korea by 2 percent. 01 depreciated.
In the data calendar of the week starting with October 11, PPI in Japan on Tuesday, foreign trade balance in China on Wednesday and PPI and CPI data on Thursday will be followed.
Intense data agenda will be followed in the country
While the domestic CPI was realized just below the expectations with a monthly increase of 1.25%, the BIST 100 index in Borsa Istanbul was followed by sellers, albeit limited. In the next week, the intense domestic data agenda will be the focus of investors, while the balance of payments statistics on Monday, industrial production on Tuesday and the market participants survey of the Central Bank of the Republic of Turkey on Friday stand out as the main data.
Economists participating in the expectations surveys of AA Finans expect the current account to run a deficit of 190 million dollars in August, and the calendar adjusted industrial production index to increase by 9.31 percent in August compared to the same period of the previous year.
On the other hand, German Chancellor Angela Merkel will visit Turkey on Saturday, October 16th. German Government Spokesperson Steffen Seibert said in a statement in the capital Berlin that Merkel will meet with President Recep Tayyip Erdogan in Istanbul on October 16.
While the BIST 100 index finished the week at 1,398,00 points with a decrease of 0.25 percent, analysts stated that technically, 1,396 and 1,383 points stood out as support, while 1,407 and 1,420 points stood out as resistance.
Dollar/TL, on the other hand, closed the week at 8.9702 with 1.23 percent value gain after seeing its historical high level with 8.9755.
Next week, unemployment on Monday, house sales on Wednesday and budget balance data on Friday will also be followed.
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