European stocks finally surged after six days of continuous fall. The stocks gained 2%. Also, favorable employment data could relieve the proposed harsh policy by the federal reserve. However, a 3-week consecutive fall was recorded as the high price rate of energy remains worrisome.
The Authorities Might Ease Rate Hike
In August, the wage rate grew moderately even though many industries in the United States employed more workers than anticipated.
Peter Essele explained that the Federal Reserve would have no choice, but to relax the speed of rate hikes if the wage rate and price of goods and services maintain a matching pace. Peter works with Commonwealth Financial Network as the head of portfolio management.
According to the data provided by Refinitiv, the money market has an 80% chance of a 75 basis point increase in interest, as the central banks across Europe plan to increase interest regardless of the high inflation rate recorded in August. This is contrary to the 50% of last week.
Fear of Winter Gas Scarcity
Russian gas is the major source of gas to Europe through Germany. They normally supply this energy through the Nord Stream 1 pipeline routes. This major gas path has however been of major concern.
The Russian-backed Gazprom stopped delivering gas to Germany on Friday to carry out some maintenance. They claim the only functioning pipeline in Nord Stream 1, is working at 20% of its capacity. There has been no flow of gas for three days.
Although they announced they would commence distribution when the repairs are over, many European nations have started storing gas. Some believe there would be a rise in the gas price in the coming winters.
TS Lombard’s head of strategy, Andrea Cicone, explained that the global economy has to prepare for the worst concerning the supply of gas. Andrea added that Europe might be at the mercy of the Russians for gas supply as winter approaches.
Other Market Reports
Switzerland’s Credit Suisse gained 6.1% amid reports that the bank plans to reduce costs by laying off about 5000 workers. Irish Ryanair also stood at 2%. They recorded their highest number of passengers last month, making it four months conservatively.
Philips lost over $24 million to settle an accusation relating to respiratory medical equipment. As a result, the Dutch company fell to its lowest level in years. Lenovo also slipped by 1.9% in its August sales. The commodity market recorded a 6% fall. This is the highest for the week.
