S&P Kicks Off The Month With Record Gains
UNITED STATES
The S&P 500 index SPX added 26.34 points to close at a record 3,526.65 with a gain of 0.8% clinching its best August return since 1986. Major U.S stocks indexes closed higher ending near or above prior all-time records, as upbeat economic reports and dovish tones from the Fed helped feed the buying momentum on Wall Street. Key events to look out for this week are the U.S jobless claims for the week ended Aug 29th are due on Thursday and U.S jobs reports Friday is forecast to show payrolls continued to rebound in August from virus lows.
EUROPEAN UNION
Stocks in Europe gained as we also witnessed the EURO pull back from a two-year high. The STOXX 600 index jumped 1.3% after dropping 0.3% the previous day with the German DAX and French CAC each gaining 1.4% while the FTSE 100 Arose 1.5%. The pullback for the euro could be attributed to comments from ECB’s chief economist, Philip Lane, who said, “the euro-dollar rates does matter”. For some, these comments constitute the first pushback against appreciation in this EURUSD cycle and may not come as a surprise. However, the central case remains that the ECB may likely stick to verbal intervention, rather than cut the deposit facility rate.
OIL
Oil gained with the price of West Texas Intermediate crude rose 0.9% to $43.16 a barrel and with Brent crude advancing 0.7% on signs U.S. crude stockpiles extended declines for a sixth week, easing a glut. The American Petroleum Institute reported crude inventories dropped by 6.36 million barrels last week, according to people familiar with the figures. That would be the longest run of declines this year if confirmed by government data on Wednesday. Meanwhile, U.S. manufacturing expanded last month at the fastest pace since 2018, signaling a recovery in demand.
SSA
The SSA Eurobond curve witnessed quite a bit of strengthening with the likes of NGERIA, ANGOL & GHANA gaining between 50c-75c on the average across their respective curves. The likes of ANGOL strengthened more after news of the Paris Club suspended debt service payments for the nation from May 1st to December 30th, 2020.