Ambivalence in US markets

■ The US stock market closed flat yesterday as the battle between support for monetary policy and concerns about investor inflationary expectations remained level. The S&P 500 was unchanged and the Nasdaq fell 0.6%. Low trading volumes of 14.3 billion shares compared to a 20-day average of 16 billion shares underscore the market's ambivalence.

■ US Producer Price Index (PPI) rose 1.3% mom in January on a seasonally adjusted basis, the largest increase since December 2009 after rising 0.3% in December 2020 (vs. with growth expectations of 0.4%). Investors remain concerned that a surge in inflation will force the Federal Reserve (FRS) to withdraw its monetary support, despite Fed Chairman Jerome Powell's expectations that inflation will be temporary this spring.

■ Powell's stance is highlighted by the minutes of the Fed's January 26-27 policy meeting, which show that flexible monetary policy has received unanimous support from a majority of its participants. Overall, striving to restore employment and keep inflation in the US above the 2% target is the Fed's main goal.

■ Seasonally adjusted US retail sales growth of 5.3% in January in January highlights the importance of additional pandemic assistance to economic recovery. This compares to expectations of 1.1% growth in January and 1% decline in December.

■ Today's markets are likely to focus on reopening Chinese exchanges after the Lunar New Years. 

Johannes Röll

Johannes Röll was born 1978 in Brilon,Germany. Graduated RWTH Aachen University. Over the past ten years he worked as Head of the plastic card team, where he was mainly responsible for the development of the distribution, Head of sales Department and Financial Analyst,where he got experience in planning and support sales figures for branches. For the present he works as freelancer

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