Daily summary: European stocks slip but Wall Street pushes higher

European indices finished today's session mostly lower as disappointing German consumer morale figures and France's household spending data raised concerns regarding Europe's economic recovery. At the same time, investors fear that rising number of new COVID-19 infections may result in the introduction of additional restrictions, after face masks became mandatory in Paris. Meanwhile, BoE Governor Bailey delivered a speech at the virtual Jackson Hole conference, however  he did not provide much detail about short-term policy responses or his view of the UK economic situation. Bailey said that the BoE is not out of ammunition and that other tools might be used, including the possibility of negative rates. He also announced that central bank is not planning to tighten monetary policy until there was clear evidence of sustained economic recovery. During today's session DAX 30 dropped 0.5%, the FTSE 100 fell 0.6% and the CAC 40 finished 0.3% lower, while the FTSE MIB closed flat and the IBEX 35 rose 0.6%. For the week, the DAX 30 increased 2.1%, the CAC 40 and IBEX 35 both gained 2.2% and the FTSE MIB climbed 0.7%, while the FTSE 100 fell 0.6%.

Meanwhile US indices are trading higher. The Dow Jones is on track to record the 4th straight session of gains. Meanwhile, the S&P 500 hit another record high for the 5th straight day and the Nasdaq rose 0.5%. Investors digest Fed's new monetary policy framework which allows a more flexible inflation target, meaning the Fed can leave rates lower for a longer period despite rising inflation. Data on Friday showed, both consumer spending and income came in above analysts' forecasts and Michigan consumer sentiment report for August was revised higher. On the week, both the Dow and the Nasdaq are on the track to gain more than 2% while the S&P 500 is expected to be up 2.5%, its fifth straight week of gains for the first time this year.

 

WTI crude erased earlier losses and trades flat around $43.00 a barrel on Friday, as Hurricane Laura passed the heart of the U.S. oil industry in Louisiana and Texas without causing any widespread damage to refineries. Brent crude futures for October, which will expire on Friday, traded around $45 per barrel and headed for a weekly gain.
Gold prices jumped more than 1.9% to around $1,968 an ounce, while silver gained more than 1.7% to around $27.5 an ounce on Friday, reversing losses in the prior session.

Next week, market attention will focus on data from the US labor market, the ADP report will be released on Wednesday, and the NFP on Friday. Moreover, investors will get to know ISM indices readings from the US and German factory orders data.