After getting squeezed for weeks, BMTR finally came up and resurfaced. The stock broke out of its consolidation to reach 1800 and it looks set to add more gains in the coming sessions. Still, the question remains whether the rally is sustainable as the global outlook remains cloudy.
Central bankers are the key figures this week as the Federal Reserve’s FOMC meets, followed by the European Central Bank meeting. The recent rally came out of the hope that both central banks will introduce some more incentives to kick-start growth again. The rallies eventually turned out of steam as markets booked profits ahead of the meetings.
Data coming out of U.S. showed that the manufacturing activities contracted for a second month in a row in July. The ISM index were down from 42.2 to 49.750.2
Elsewhere, the ADP said that US private sector had added 163K workers in July, a good sign that the nonfarm payrolls, which is due on Friday, will show a good number enough to boost sentiment.
The Federal Reserve’s FOMC meeting failed to deliver specific plan to stimulate the ailing U.S. economy. The Fed said that it will monitor the market conditions and provide more accommodative policy whenever needed. As no specific plan was laid out, the market seemed to be disappointed. Still, there is still one more CB event to unfold: the ECB meeting.
The final key event this week is the nonfarm payrolls data set for release on Friday. We already had the sentiment shot once by Fed’s indecisive decision and we have two more opportunities to provide the needed boost for the market this week. If both also fail to impress, the market will be at risk of collapsing again.
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