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Data trades US and European stocks during a tumultuous week



Data trades US and European stocks during a tumultuous week

Rising tensions after the Wall Street inflation data, and volatility in stock trading, and the recent sell-off combined largely with uncertainty, with the Standard & Poor’s 500 index falling 117.05 points to close at 2.91%. At 3900.77 points the Nasdaq Composite was down 415.07 points or 3.53% at 11339.16 points and the Dow Jones Industrial Average was down 882.47 points or 2.73% at 31395.72 points.

U.S. stocks fell sharply on Friday, recording the biggest weekly percentage decline since January, and according to data, the Standard & Poor’s Week was up 5.06%, the Dow Jones 4.58% and the Nasdaq 5.60% higher than expected. The U.S. raised investor fears in May that consumer price inflation in the states and the Federal Reserve would raise higher interest rates, and estimates of technology stocks that will depend on future liquidity led to a decline.

After the inflation report, the US 10-year treasury yield reached 3.152%, the highest level since May 9, and the consumer price index rose 1% last month after the US Department of Labor report rose 0.3% in April. A Reuters poll by economists expected monthly CPI to rise 0.7% and year-on-year CPI to 8.6%, the largest increase since April 1981 after 8.3% growth.


On Friday, European stocks fell 2.7%, and the likelihood of a recession increased as central banks tried to control prices after inflation in the United States exceeded expectations.

Pan-European Stoxx 600 losses were widespread, leading to a 4.8% decline in the banking sector. The index continued its losses for the fourth consecutive session, reaching its lowest level since May 12, and will face losses of more than 3% on a weekly basis.

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Italy’s MIB index fell 5.2% to a three – month low. Spain’s ipex fell 3.7%, while other major exchanges in the region each lost more than 2%.

The main inflation rate for the United States for May was 8.6%, which is higher than expected at 8.3%, indicating that the Federal Reserve will raise interest rates by 50 basis points until September to combat inflation.

Shares traded higher on Thursday, after the European Central Bank said it would raise interest rates for the first time since next month after 2011, and may make big moves in September.

Eurozone shares fell 3.1% on Friday.

Concerns about demand and growth have increased in China, the world’s second-largest economy, after Shanghai and Beijing imposed new sanctions to combat COVID-19. Among individual stocks, GlaxoSmithKline rose 1.6 percent, with the pharmaceutical company proving successful in one of its vaccines in a delayed trial involving the elderly.

Shares of regional airlines plummeted during the busy summer months as labor disputes in Europe raised expectations of travel problems.

Shares of Ryanair, International Consolidated Airlines, Lufthansa and Wizz Air fell 1.6 to 4.1 percent.


Japan’s Nikkei Index ended its five-session winning streak on Friday, with the central bank’s monetary policy tightening in anticipation of key US inflation data as investors watch Wall Street fall overnight.

The Nikkei Index was up 0.23% for the week, gaining for the fourth week in a row, with the broader Topix index up 0.51% for the week.

On Friday, shares of growth firms fell 1.73% as stocks expected to grow at a much higher rate than the market growth rate, including technology firms.

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Chip test tool maker Advantest fell 4.2%, while chip maker Tokyo Electron fell 3.22%.

Shares of Fast Retail, the apparel chain of Softbank Group for Uniclo and Technological Investments, fell 0.93% and 2.01%, respectively. (Reuters)

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Inflation in the euro zone fell to its lowest level in a year



Inflation in the euro zone fell to its lowest level in a year

Economic data released today on Friday showed that the euro zone’s core inflation rate fell to its lowest level in nearly a year this month, bolstering expectations that the European Central Bank will keep interest rates on hold at its next meeting to assess. The consequences of an unprecedented campaign to raise interest rates throughout the past.

European statistics agency Eurostat reported today that sales, excluding highly volatile items such as food and energy, fell to 4.5% this September, while analysts polled by Bloomberg News had expected a drop of 4.8%, compared with 5.3%. In the month, in the past.

At the same time, the headline inflation rate eased to 4.3% this month from 5.2% last August, the lowest level in nearly two years and well below expectations, thanks to a fall in energy prices. Accelerating rate of rise in prices of services.

The data released today is a strong indication that core inflation, a key measure for the central bank’s monetary policymakers, is on a downward path following a period of statistical deterioration over the summer months.

Despite the decline, general and core inflation rates have been more than twice the central bank’s target of 2% annually.

At the same time, there is a wide disparity in inflation rates between the euro zone’s twenty member states, with the inflation rate in Germany falling to its lowest level in two years this month, while the rate in Spain rose by more than 3. % again.

The current September consumer price inflation rate showed a new decline, reaching its lowest level in more than a year and a half, with the Italian statistics office saying the inflation rate fell to 5.3 for the current month. % y/y compared to 5.4% last month, while the core inflation rate, excluding highly volatile food and energy prices, fell to 4.6% this month, down from 4.8% last month.

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Meta unveils new artificial intelligence products



Meta unveils new artificial intelligence products

Mark Zuckerberg, CEO of MetaPlatforms, has introduced a group of new products powered by artificial intelligence, including smart glasses that can answer questions and broadcast live on Facebook, as well as “bot” programs to create images and an advanced headset for virtual reality. .

Zuckerberg described the products as bridging the virtual and real worlds, and asserted that low-cost or free artificial intelligence in what Meta offered could be integrated into daily routines.

The MetaQuest virtual reality headset is one of the most popular in the burgeoning virtual reality industry, and company executives described it as the best value in the industry, marking the imminent launch of an expensive headset from Apple.

Speaking from the central courtyard at Meta’s sprawling campus in Silicon Valley, Zuckerberg said Meta’s new generation of Ray-Ban smart glasses will launch on October 17 for $299.

The device will have a new assistant from Meta that works with artificial intelligence and will be able to live-stream what the user sees on Facebook and Instagram, a feat compared to the previous generation’s ability to take pictures.

Earlier during the presentation, Zuckerberg said that the latest mixed reality headset (Quest) will start rolling out on October 10.

Zuckerberg’s statements came at the MetaConnect conference, the social media company’s biggest event of the year and the first to be held in person since the start of the Covid pandemic.

It launched the first consumer-oriented generative artificial intelligence products, in which a chatbot (meta AI chatbot) can generate text responses and realistic images.

Zuckerberg emphasized: “It’s not just about answering inquiries. It’s about helping people do things for entertainment and interacting with the people around you.”

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The US economy is between the trap of recession and stubborn inflation



The US economy is between the trap of recession and stubborn inflation

Debate continues among officials and big banks over whether the US economy will fall into recession, as analysts expect the economy to slip into recession as it faces stubborn inflation and raises interest rates to record highs. .

Expected growth

Data for the final reading of US GDP showed the economy grew by about 2.1%, which is the same as the second reading. In the second quarter of 2022. Fixed income investments showed a growth of around 5.2% in the three-month period ended June, compared to 3.1% in the first quarter.

US exports fell 9.3% in the second quarter, and imports fell 7.6%. As for personal consumption expenditures, they rose about 0.8%, compared with a 3.8% increase in the first quarter.

A survey showed that business activity in the U.S. is close to stagnating in August 2023, with growth hitting its slowest level since last February, as demand for new business in the largest services sector has weakened.


Standard & Poor’s Global said – in its preliminary composite purchasing managers’ index for the US, which tracks the manufacturing and services sectors – the reading fell to 50.4 points in August from 52 in July; This marks the biggest decline since November 2022.

Although August’s reading showed growth for the seventh month in a row, it was slightly above the 50-point level that separates growth from contraction, in light of weak demand for manufactured goods and services.

For months, a strong labor market and strong consumer spending have eased recession fears, and both factors led to an upward revision in GDP growth expectations, but the data paint a less optimistic picture of the economy.

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Recession is possible

Abhilash Narayan, director and chief investment strategist at Standard Chartered, believes the probability of the US economy entering recession next year is 50 to 60%.

In an interview with “Eqtisad Al-Sharq”, Narayan cited three reasons for this, the first being that consumer spending, which has been a fundamental factor in the strength of the US economy, will slow down as savings run out, the second is the risk of a government shutdown in October, which will limit government spending, and the third is that the 18 Date strong interest rate hike. Last month, the Federal Reserve showed its negative impact on US economic activity in 2024.

“Healthy” mode

On the other hand, Treasury Secretary Janet Yellen said the US economy shows no signs of an imminent slowdown.

Bloomberg News quoted Yellen as saying in an interview with CNBC last week that “I don’t see any signs that the economy is headed for a recession,” and that while the labor market may have contracted somewhat, the market is still there. A “healthy” situation. Industrial production is increasing and “inflation is falling.”

Yellen said she is watching for several developments, including the potential impact on consumer spending as student loan payments resume after a multi-year hiatus.

He noted that despite the rise in interest rates, credit is still available and “it has made a difference in some sectors”. He also said that he expects crude oil prices to stabilize.

Interest rates

Commenting on the decision to stabilize US interest rates in September, US Federal Reserve Chairman Jerome Powell said the bank was ready to raise interest rates at any time to push annual US inflation to 2%.

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The chairman of the Reserve Bank emphasized that despite factors beyond the central bank’s control, there is a good chance that strong interest rate hikes will not push the US economy into recession.

Moderate depression

Central bank experts expect the potential economic consequences of recent bank developments to lead to a “moderate recession” later this year. Bank failures can make borrowing more difficult, reduce spending and impact economic activity, meaning lenders may tighten their standards in the wake of recent bank failures.

Real estate sector

Mortgage interest rates in the U.S. rose last week to their highest level since 2000, negatively impacting already low home-buying applications.

The average 30-year fixed mortgage rate rose 10 basis points to 7.41% in the week ended Sept. 22, according to Mortgage Bankers Association data released Wednesday. As a result, the home purchase order index fell to 144.8, one of the lowest readings in decades.

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