According to Michael Casey of MarketWatch fame it’s time to
put down the margarita, climb out of the hammock, and perk up. If ever there were a week to end the sleepy
calm of an uneventful summer in world markets, it is the one that’s about to
hit us. The next six trading days are full of what traders call “event risk,”
or what we journalists call “news.” That could break currencies and other
markets out of their narrow trading ranges. It will be a week to make money —
or to lose it. Here’s what’s on tap:
Thursday, Sept. 6: Mario Draghi’s press conference. The
president of the European Central Bank will be locked in a room with a hundred
or so journalists, each eager to extract details on his plan for the ECB to buy
the bonds of troubled European sovereign nations such as Italy and Spain. And
in the meeting of the central bank’s governing council that precedes this media
event, the ECB’s decision makers might actually vote on the initiative. Over
the past month, European bond markets have rallied--along with the euro and
various risk-sensitive assets--as Mr. Draghi has dropped hints about the plan…..
Friday, Sept. 7: U.S. nonfarm payrolls report. This seminal
piece of data will be the last piece of the economic jigsaw before the Federal
Reserve Open Market Committee decides on whether to deliver more monetary
stimulus. The apparent lack of a consensus on the FOMC makes for an even more
important jobs report than normal. After employers added a surprisingly large
163,000 new jobs in July, the market is looking for an August readout of
125,000. Anything higher and the dollar could rally sharply against most of its
counterparts as traders would downgrade expectations for Fed action next week.
Wednesday, Sept. 12…
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