Morning Report

August 23, 2021

“The dollar retreated off of a nine-month high on Monday, after a bounce in Asian stocks boosted currency markets in the East at the expense of the dollar, despite it’s safe haven status. Comments by the Fed’s Robert Kaplan on Friday indicated a less-hawkish stance to tightening monetary policy creating uncertainty for investors.”

Tim Hallinan, Trading Director

Main Headlines

The US economic recovery is reportedly slowing, ahead of central bankers meeting at the annual Jackson Hole conference on Thursday of this week where US monetary officials will meet. A post-lockdown acceleration in spending had driven strong growth across the economy, however, now growth is fading meaning the Federal Reserve may suspend plans to scale back its bond-buying programme and may have to abandon plans to tighten monetary policy. The Delta variant and supply chain issues are causing the US economy to stutter, whilst global stock markets took a beating last week after the Federal Reserve signalled they would tighten monetary policy soon.

Female board members at FTSE 100 companies in the UK are paid on average 40% less than their male counterparts, revealing the gender pay gap is widest amongst the categories of highest earners. Data published by the New Street Consulting Group found that average pay for executives for female board members was £1.5m, whilst male board members took home £2.5m. In non-executive positions, women took home an average pay of £104,800 as compared to £170,400 for men. Progress has been made as female directors account for 34.3% of executives at FTSE 350 companies but salary data reveals there is much more to do to reach gender parity.


Sterling is well-bid against all majors in early morning trade. Boris Johnson will host G7 talks on the security crisis in Afghanistan, due to Britain’s role as chair of the bloc at this time. Talks are due to focus on the longer-term outlook to the Afghan crisis and the UK is said to concede that China and Russia must be recognised as having a major role to play, following US withdrawal from the country recently. Health Secretary, Sajid Javid announced a crackdown on “cowboy companies” offering Covid-19 tests for prices which exploit UK travellers and holidaymakers, expelling 82 companies from the government’s approved list.


The euro is higher against the dollar and lower against sterling overnight. The inaugural Crimea Platform summit kicks off in Kyiv with 40 government’s represented, chaired by Volodymyr Zelenskiy. The summit aims to end the Russian occupation of the peninsula. Von der Leyen, Charles Michel and Josep Borrell have earmarked €57mn of financial support for Afghanistan, but Von der Leyen indicated that this could only be a start and the EU would need to go further. In a speech on Sunday, Swedish Prime Minister Stefan Löfven said that he would resign as both head of the Social Democrats and as the country’s leader at the party congress in November.


The dollar is lower against most majors in early morning trade. The Biden Administration is considering extending the deadline for withdrawal from Afghanistan after Defence Secretary Lloyd Austin approved plans on Sunday to provide commercial aircraft to support evacuation of US citizens and Afghans from Kabul International Airport. US carriers such as American Airlines, Delta, United Airlines and others will make up a fleet of 18 commercial carriers evacuating Afghans and Americans to bases across the Middle East, before heading to the United States or third countries. This follows a statement by a NATO official in Kabul that at least 20 civilians have died at the airport in the past week.


Stocks rose Monday along with U.S. and European futures as traders took advantage of last week’s selloff while keeping a wary eye on risks from the delta virus strain and China’s regulatory crackdown. MSCI Inc.’s gauge of Asia-Pacific shares posted one of its biggest daily rallies this month, led by Japan. Chinese technology stocks rebounded from a prolonged selloff, while South Korea climbed as export data signalled resilient global demand. The S&P 500 and Nasdaq 100 advanced Friday on dip buying. Treasury yields ticked up. Investors are also looking ahead for insights into how the Federal Reserve plans to taper bond purchases.

Main Economic Data/Central Banks/Government (All Times CET)

10:00 a.m.: Euro-area Aug. P Markit PMIs

10:30 a.m.: U.K. Aug. P Markit PMIs

11:00 a.m.: Norway, Cyprus to sell bills

12:00 p.m.: U.K. Aug. CBI Trends Total Orders

2:50 p.m.: France to sell bills

4:00 p.m.: Euro-area Aug. Consumer Confidence

Corporate Events

Earnings include, Wuxi Biologics, Palo Alto, Investment AB


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