Financial Markets Daily Report

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Yesterday markets steadied after a few mixed sessions. Volatility nudged down and European stocks rebounded, while U.S. equities posted moderate gains.

Markets suffered a risk-off session amid concerns over the debt ceiling in the U.S. Volatility jumped and stocks were lower across advanced and emerging economies as Republicans blocked a Democratic move to raise the debt limit. U.S. Treasury Secretary Janet Yellen warned that her department will run out of cash around October 18.

Investors traded in a cautious mood in the first session of the week. Volatility rose, U.S. equities declined moderately and European and EM stocks nudged up.

Markets ended the week in a mixed mood as investors pondered over the Fed's plans for stimuli withdrawal, risks from China's Evergrande and the announcement that Chinese authorities will ban all transactions and mining related to cryptocurrencies. Global stocks declined or closed flat while the USD rose against most AE and EM currencies.

Yesterday's FOMC meeting was received without major surprises by financial markets. The Fed announced, as broadly expected, that the tapering on asset purchases would start soon if economic indicators come in as expected and that net asset purchases would finish by mid-2022.

In yesterday’s session, investors’ sentiment improved as concerns on Chinese Evergrande’s fallout eased.

Financial markets started the week with a risk-off session fuelled by concerns that Evergrande, a giant property developer in China, is facing a liquidity crisis and might not be able to service its debt repayments.

In a session with a Triple witching hour in the U.S., an event that usually increases volume and volatility as several futures and options expire simultaneously, stock indices declined in the euro area and in the U.S. while sovereign yields edged moderately up on both sides of the Atlantic.

Markets were mixed on Thursday. EM and U.S. stocks ended lower while European equities rebounded from a seven-week low, led by the travel and leisure sector.

Yesterday, investors continued to trade in a cautious mood. Asian stocks dropped after weak retail sales and industrial production data in China. In advanced economies, European equities declined while U.S. stocks rose on the back of greater optimism on the U.S. economic outlook.

Markets traded in a cautious mood in yesterday's session. Stocks were mixed across advanced and emerging economies while in FX markets the USD strengthened against the major currencies. In commodity markets, prices were little changed.

Markets started the week on a moderately positive note. In a session with no major economic releases, volatility declined, stocks rose moderately across advanced economies, and EM equities were mixed.