Increased risk aversion, stock markets around the world are losing

Israel decided to retaliate and attacked a military facility in Iran. Today, stock exchanges in Europe are losing rapidly. WIG20 declines by 0,75%. and WIG by almost 0,5 percent. The German DAX is below the mark by almost 1%. The zloty has been under downward pressure since the morning. Gold rose to the level of 2416 and then fell towards USD 2385.

Fear Index grew above 21 points. to the highest level since October 2023. Yesterday's session on Wall Street was negative despite a moderate increase in the Dow Jones index by 0,1%. The Nasdaq Composite ended the day with a result of -0,5%. and SP500 achieved a result of -0,2 percent.

The market is in risk-off mode

Currently, there is increased risk aversion due to Israel's retaliation against Iran after the earlier weekend drone attacks. The morning's events do not indicate that today's session will be colored green. So far, stock exchanges in Europe are losing, which is consistent with the picture of the last dozen or so days. The correction on the indices is deepening. The dollar was gaining in the early morning hours, once again confirming its role as a "safe haven".

The zloty lost initially, but we are now seeing the EUR/PLN and USD/PLN pair return to levels similar to yesterday's closing. The fact that the market is in risk-off mode is also evidenced by the increase in gold prices above $2415 (although now the morning movement has been largely eliminated).

Returning to yesterday's events, the market received a portion of further statements from Fed representatives. Mester, Wiliams and Bostic commented on current and future monetary policy. The general tone is that U.S. interest rates will remain elevated for longer, and no opinion suggested even in the slightest that the first change in monetary policy parameters would take place in June. In the second part of the day, the dollar gained, which resulted in a lower level of the EUR/USD exchange rate.

Cooling demand on the real estate market

Weekly data from the US labor market continue to indicate that it is in good shape. The number of applications was 212. which gave the same result as before and was slightly lower than the expected PLN 215. In turn, sales of houses on the secondary market fell by 4,3% in March. on a monthly basis. It amounted to 4,12 million. The scale of construction starts has also decreased. There is a visible cooling of demand on the real estate market, which is partly due to higher loan interest rates.

Today the macro calendar is poor. In the morning we only learned data on producer prices in Germany and retail sales in the UK. Overnight, Japan presented consumer inflation.

Source: Łukasz Zembik, OANDA TMS Brokers