​ ​US

Equity markets experienced larger swings over the week, as economic data posted more disappointments, and attention shifted to the Jackson Hole meeting, where Fed President Jerome Powell will give an opening speech. Over the past 5 days ending Thursday, the 3 major equity indices lost 1.98-2.51%. Powell’s scheduled speech likely carries much weight, but markets were unsure of the direction, volatility increased over the week. Other Fed members continued to give hawkish signals, St. Louis Fed President James Bullard suggested that inflation could be more persistent, Minneapolis Fed President Neel Kashkari emphasised the need to keep the monetary policy tight, and Kansas City Fed President Esther George also agreed that the Fed has more work to do regarding rate hikes.

On the economic data front, August Markit Manufacturing PMI in the US was 51.3, missing market expectations of 52 and came lower than July’s 52.2. Markit Services PMI posted a larger surprise, plunging to 44.1 in August, which was much lower than the consensus of 49.2 and the 47.3 of the previous month. Labour market on the other hand stayed tight, with initial and continuing jobless claims both lower than market expectations. In other news, the US administration has signalled that the US will agree to an Iran deal if it would benefit the country, raising hopes that the supply shortage could see further easing. Next week, the US will be releasing conference board consumer confidence index, ISM manufacturing index, as well as non-farm payrolls data.

 ​Europe

After the earlier gains, European markets retreated this week, with the UK, French, and German equity indices losing 0.82-3.11% over the past 5 days ending Thursday. ECB released the minutes for the July meeting during the week, revealing that most members backed a 50 bps hike. Members also indicated their concern over the weak Euro further contributing to the high inflation levels. The Euro further depreciated against the US Dollar during the week, falling below parity for the first time in 20 years. Natural gas prices in Europe rose further during the week, with Dutch TTF Gas Futures passing the 300 Euro per megawatt hour mark, as Gazprom announced another unscheduled maintenance for Nord Stream 1. On the economic front, Eurozone manufacturing PMI was 49.7, beating market expectations, while services PMI of 50.2 slightly missed the market estimates of 50.5. Eurozone consumer confidence and German IFO Business Climate in August on the other hand were both better than expected. Next week, Eurozone will release the unemployment rate in July, as well as the CPI data for August

​China

Hong Kong and Chinese equity markets were mixed this week. The CSI 300 index lost 1.05%, while the Hang Seng Index gained on the back of positive rumours over the Sino-US audit spat, and ended the week 2.01% higher. The State Council announced a policy package of 19 measures during the week, unveiling plans including infrastructure projects, totalling 1 trillion yuan in bids to stabilise the economy. It was rumoured that an audit deal between US and China was reached, which could prevent the Chinese companies from delisting from US markets, tech heavyweights surged, driving the Hong Kong equity market higher. China announced cuts to the Loan Prime Rates (LPR) as expected, cutting the 1Y rate to 3.65% from 3.7%, and the 5Y rate was also reduced to 4.3% from 4.45%. Markets will continue to monitor if the rate cuts will bring further easing of financing conditions. Next week, China will announce the Manufacturing PMI and Caixin Manufacturing PMI for August.