U.S. stock-index futures rose, with global equities set for the biggest three-day rally since April, as earnings optimism outweighed concerns about growth hiccups and coronavirus flareups. September contracts on the S&P 500 Index and Nasdaq 100 Index rose at least 0.2%, each closing 4,358.69 & 14,631.95 respectively while the Ten-year Treasury yields declined two basis points to 1.27%. Eyes will also be on the initial jobless claims and new home sales data in the US.
In Europe, focus would be on the ECB with a new inflation target and forward guidance (Lagarde press conference at 13:30 London time) with a look at how the ECB incorporates a strong forward guidance into its policy objective function (ECB officials will outline how their new inflation goal affects their intentions for future monetary policy). Some view that the forward guidance should become the main policy tool for the ECB once PEPP ends next year.
Crude oil fluctuated between gains and losses as investors weighed signs of continued demand for oil products, including gasoline, against disruptions triggered by the spread of the delta variant. West Texas Intermediate crude jumped the most since mid-April on Wednesday after a U.S. government report showed declining fuel and distillate stockpiles during the high-demand summer driving season. The surge pushed the benchmark back above its 50-day moving average – a bullish indicator – to settle at $70.30 a barrel, while Brent oil changed little after rising more than 4% on Wednesday.
Fitch Ratings has affirmed Mozambique’s Long-Term Foreign and Local Currency Issuer Default Ratings (IDRs) at ‘CCC’. Mozambique’s ‘CCC’ rating reflects risks to debt sustainability from elevated debt levels, as there are limited sources of financing combined with high fiscal, external financing needs, and still unresolved public-sector debt liabilities. The ongoing impact of the pandemic and security risks increase near-term expenditure pressures, and, in the context of relatively limited sources of financing, could negatively impact medium-term growth prospects and increase challenges to debt sustainability.