Stocks are turning down. Markets are afraid of the Fed after the data

Data from the US labor market has provided us with some complicated material to interpret as numbers from companies and household surveys go against each other (more in today’s commentary). At first, the markets reacted to them with embarrassment, but not significantly. However, after opening on Wall Street, the stock picked down.

The main reason seems to be the heightened concerns about the Fed. At the same time, they are not concerned about its tightening following the strong recovery, but rather about the Fed’s tightening policy despite a weaker recovery. That, of course, would be a worse option. If the recovery is really fading faster, more statistics will probably show. In the case of the Fed, however, we expect it to remain on the path to abolishing QE and raising rates recently, which President Powell recently led him to. This was subsequently supported by other bankers, and it would be too politically difficult to turn the rudder back before the December 15 meeting.

Of the major markets, it catches the most Nasdaq (-1.5 pct). The S&P 500 and AEX are down 0.6 pct, the DAX and CAC 40 are down 0.4 pct, while the FTSE 100 is still struggling to defend yesterday’s levels. Revenues after the data changed direction several times. In the US, short maturities are slightly higher, longer ones than yesterday. In Europe, developments are mixed with small yield shifts. The Eurodollar deepens its decline and the exchange rate reaches 1.1270. Gold is +0.4 pct today, oil has grown decently by 3.7 percent despite the promise of further increase in OPEC + production. The end of the week was weak for the koruna, as it lost slightly against the strengthening dollar, while it improved slightly against the euro.