The war in Ukraine has tended to increase uncertainty regarding inflation and growth prospects. When and with what consequences this war will end is pure speculation, but capital markets are expected to build a certain immunity to the headline risks in the coming weeks. The medium- to long-term consequences, on the other hand, could be significant. It is possible that we are at the beginning of a new bloc formation or a new Cold War. This would put a significant damper on globalization and further fuel higher structural inflation. 

US equities closed higher for a fourth consecutive session on Monday, extending last week’s rally to levels not seen in two weeks, with support from increasing optimism that inflation has peaked. The Dow Jones added over 200 points, while the S&P 500 and the Nasdaq gained 1.1% and 3.1%, respectively. In the meantime, European equity markets posted even higher gains, with the Euro Stoxx 50 adding over 2% led by financials, real estate and materials shares. 


  • Equity markets in Asia extended the global rally on Tuesday, amid hopes that US prices data might offer another signal that inflation has peaked. The Kospi surged over 2.5% to trade at a near 2-week top, led by a jump in chipmakers, while shares in China and Hong Kong rose modestly as trading resumed from a holiday. The ASX extended gains for the fourth session due to a rebound in consumer sentiment. 
  • European equities are poised to take a breather while US futures are also seen flat as the markets await the key inflation report later in the afternoon. 
  • Oil prices fell in early morning trade to snap a three-day winning streak, as market caution dominated sentiment ahead of US inflation data that could influence the Federal Reserve’s tightening plans and the trajectory of global growth. 
  • US consumer inflation expectations for the year ahead fell for a second month to 5.7% in August, the lowest reading since October last year, from 6.2% in July. Consumers now see prices rising less for gas, food and rent. 
  • Twitter rejected a third attempt by Elon Musk to cancel his agreement to buy the social network, a day before the company’s shareholders shall be asked to vote on the $44-billion-deal. 
  • Apple shares were almost 4% higher yesterday as two analysts, in separate research notes, concluded that presales of Apple’s new iPhone 14 are doing better than expected. Analysts pointed towards higher orders for the most expensive iPhones and also longer wait times compared to previous launches. 
  • Goldman Sachs will cut jobs as early as this month after pausing the annual practice for two years during the pandemic. The Bank typically trims about 1% to 5% of its staff each year, and the 2022 cuts will likely be in the lower end of that range.