The Amsterdam AEX started the week of April 22 well with an increase of 0.93%. After the disappointing last week, in which chip maker ASML, among others, pulled the stock market down sharply, today it is Prosus that steals the show with an increase of 5%.
However, there are a lot of crucial macroeconomic data points scheduled for this week, meaning volatility seems guaranteed.
Next Friday will be crucial for the AEX
It has probably not escaped your attention that inflation in the United States was higher than expected (and hoped). As a result, expectations for interest rate cuts from the US central bank have been put on hold and we will probably not see the first interest rate cut from the Federal Reserve until September.
This is in stark contrast to the 6-7 interest rate cuts that were expected at the beginning of 2024. If the situation remains as it is now, the market expects only one interest rate cut from the US central bank this year.
In that respect, Friday will be crucial for the financial markets, because that is when the US central bank’s favorite inflation gauge is scheduled to be released. It concerns the Core PCE price index and for the time being the expectations about that inflation meter are not fantastic.
Therefore, a windfall on Friday can send the prices into the weekend with green numbers, but there is also a chance of the opposite. For that reason, next Friday in particular seems important for the AEX price.
A lot of uncertainty on the trading floor
We are therefore dealing with rising inflation in America, while geopolitical tensions are also increasing on several fronts. All in all, this creates a lot of uncertainty on the financial markets worldwide and that does not benefit the Amsterdam AEX.
Tech companies in particular have had a hard time staying afloat in recent weeks. While the chip sector was the big star of the stock market for a long time, it has also suffered blows in recent weeks.
Not only the Dutch ASML fell down, but NVIDIA is also in trouble.
It is hoped that the tech companies (and Bitcoin) find a bottom quickly, otherwise it could be a sour second quarter of 2024. Although after the extremely good results of recent months, it is not surprising that the market needs to take a breather.
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Source: https://newsbit.nl/aex-koers-herstelt-in-cruciale-week-voor-de-beurs/
