Focus on private sector PMIs and consumer confidence

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Major

It was a relatively bullish day for the European majors on Friday, with the majors reversing losses from the start of the session.

The DAX30 rose 0.27%, with the CAC40 and EuroStoxx600 posting gains of 0.31% and 0.33% respectively.

A calm economic calendar allowed markets to pause after the week’s downturn.

Apprehension ahead of next week’s Jackson Hole Symposium and worries about the Delta variant have caught up with the majors, however.

Statistics

In July, the German producer price index for industrial products rose 1.9% against an expected increase of 0.8%. The index rose 1.3% in June.

According to Destatis,

  • Compared with July 2020, the index is up 10.4%.
  • This is the largest increase from the corresponding month of the previous year since January 1975.
  • Higher prices for intermediates and energy pushed the index north.
  • The prices of intermediate goods increased by 15.6% compared to July 2020 and by 2.3% month on month.
  • Energy prices as a whole are up 20.4% from July 2020 and 4.1% from June 2021.

The United States

There were no major statistics to give direction to the European majors at the end of the day.

Market movers

For the DAX: Friday was a mixed day for the automotive sector. Daimler rose 0.39% to reverse the trend for the day. Bmw and Continental decreased by 0.30% and 0.22% respectively, with Volkswagen ending the day down 1.09%.

It was a bearish day for the banks. German Bank and Commerzbank ended the day with losses of 0.38% and 0.37% respectively.

From CAC, it was a relatively bullish day for the banks. BNP Paribas increased by 0.37%, with Gen Soc and Agricultural credit ending the day up 0.02% and 0.17% respectively.

It was another day in the red for the French auto industry, however. Stellantis SA and Renault decreased by 1.15% and 1.13% respectively.

Air France-KLM decreased by 1.26%, while Airbus SE increased by 0.40%.

On the VIX index

He was back in the red for the VIX on Friday, ending a 4-day winning streak.

Reversing a 0.46% gain from Thursday, the VIX slipped 14.35% to end the day at 18.56.

The NASDAQ rose 1.19%, with the Dow Jones and the S & P500 posting gains of 0.65% and 0.81% respectively.

The day to come

It is a busy day in the economic calendar for the euro area. The preliminary private sector PMIs in August for France, Germany and the Eurozone will be the focus of attention at the start of the European session.

Expect a lot of influence from the numbers as markets seek to assess whether the Delta variant has had an impact on business.

With consumption being the key to a sustainable economic recovery, the Eurozone consumer sentiment figures for August will also attract attention at the end of the day.

From the United States, preliminary private sector PMIs will also be the focus, with services PMI being the main driver.

Discussions by FOMC members ahead of Jackson Hole and COVID-19 will also remain the main areas of focus.

Future

In the futures markets, at the time of writing, the Dow Mini was down 12 points.

For an overview of all of today’s economic events, check out our economic calendar.


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