The Ibex and the rest of the European stock markets They anticipate an upward opening this Wednesday (Euro Stoxx futures: +0.77%), in a key day marked by the Federal Reserve (Fed) meetingfrom which no rate cuts are expected, much less in an environment of rising energy prices. The market continues to bet on the continuity of last day’s rebound in stock marketsalthough with caution in the face of inflationary risks derived from the rise in crude oil prices.
WHAT THE FED WILL DO
The Federal Reserve (Fed) will leave interest rates unchanged again this Wednesday, in the range between 3.50%-3.75%. It is the decision that discounts the market for a meeting that will be marked by the conflict in Iran and, above all, due to the inflationary risk of rising oil prices. For this reason, analysts believe that the US central bank will remain paused and cautious. «It is difficult to imagine a scenario other than one in which the Fed leaves interest rates unchanged at this meeting,» said Christian Scherrmann, chief US economist at DWS. «We expect the Fed to keep interest rates unchanged in March, in a context of persistent inflation and uncertainties linked to the situation in the Middle East«advances François Rimeu, senior strategist at Crédit Mutuel Asset Management. All in all, this meeting will have several points of interest, since the Fed will update both its macroeconomic outlook and its ‘dot plot’the diagram that reflects where rates are expected to be in the coming years. Furthermore, investors will be very attentive to the words of its president, Jerome Powell. «In December, the Federal Reserve was contemplating a rate cut in 2026 and another of 25 basis points in 2027. There is great uncertainty about the duration and intensity of the conflict and disruptions, so the Fed will have little certainty in its forecasts«, they point out from ING Economics. Wall Street awaits the Fed’s decision, which will be known starting at 7:00 p.m. Spanish time due to the time change that occurred on the other side of the Atlantic a few days ago, positively. Futures are advancing 0.55% on average now. This, after the stock markets will close on Tuesday with purchases (Dow Jones: +0.10%; S&P 500: +0.25%; Nasdaq: +0.47%). The good tone has spread this morning to Asia, with a clearly bullish session and advances close to 3% in the Japanese Nikkei and more than 4% in the South Korean Kospi.
MORE MACRO AND GEOPOLITICAL REFERENCES
The day’s agenda also includes the publication of the February Eurozone CPIwhose preliminary data showed a rebound to 1.9%, above what was expected. Besides, Bank of Canada to announce rate decision before the Fed, and the consensus suggests that it will keep them unchanged at 2.25%. All this in a context in which the market remains very aware of the evolution of the conflict in Iran, which continues to escalate. This Wednesday, Iran intensified attacks against US assets in the Middle East and against Israel, in apparent retaliation for the death of his security chief, Ali Larijaniin a night operation. According to the Iranian Revolutionary Guard, its missiles have hit more than 100 military and security targets in the heart of Israeli territory as «revenge» for his assassination. Iran’s Supreme National Security Council has confirmed Larijani’s death, together with his son Morteza Larijani and the head of his office, Alireza Bayatas well as several guards, according to the Associated Press. In this scenario, oil remains at high levels, although it registers moderate falls after the last climbs. A barrel of Brent is trading at $101.26 (-2.09%), while WTI is at $92.98 (-3.36%). The evolution of crude oil will continue to be key for the markets, since its rise in price adds inflationary pressure and complicates any scenario of short-term rate cuts by central banks.
OTHER MARKETS
The euro is exchanged at 1.1547 dollars (+0.07%). Gold is trading flat ($5,011) and silver falls very slightly ($79.79). The yield of the 10-year American bond moderates to 4.175%. Bitcoin is trading at $74,072 and Ethereum is trading at $2,329.
