TOPICS MENTIONED IN THIS MARKET BRIEFING:

• European stock markets penalized by fears over the economy
• Wall Street climbs with tech stocks
• Chart of the day – EUR/CHF: a long-term slant

European stock markets penalized by fears over the economy

European stock markets fell on Thursday amid fears over the strength of the economy's recovery fueled by the Bank of England's pessimistic forecasts and by jobless claims in the United States which again exceeded one million last week. .

The London Stock Exchange was particularly penalized by announcements from the BoE, which said on Thursday it expected the British economy to take longer than initially expected to return to its pre-pandemic level.

The UK's central bank has decided unanimously to leave its key rate unchanged at 0.1% and not to change its program of bond purchases in the markets, even though it now expects the economy to will not return to its end-2019 level before the end of 2021

Thus, the CAC 40 index lost 0.98% to 4,885.13 points. The Footsie fell 1.27% and the DAX 30 fell 0.54%.

Wall Street climbs with tech stocks

Wall Street ended higher on Thursday after a hesitant start to the session, driven by the technology giants, which pushed the Nasdaq Composite for the first time in its history above the 11,000 point mark.

The index with strong technological coloring once again benefited from the good health of several of its flagship stocks, including Alphabet (+1.75%), the parent company of Google, Amazon (+0.62%), Apple ( +3.49) or even Microsoft (+1.60%).

New claims for unemployment benefits reached 1.186 million in the week to August 1 in seasonally adjusted data, compared to 1.435 million the previous week, according to published data from the Labor Department.

The market is now waiting for the monthly employment report which will be published this Friday. The Reuters consensus expects 1.485 million non-agricultural job creations in July against 4.767 million in June.

Top Democratic leaders in the US Congress and the Trump administration are trying to hammer out a compromise that would ensure continued public financial support for the millions of Americans hit by the economic fallout of the pandemic.

Consequently, the Dow Jones, took 0.68% to 27,386.98 points. The Nasdaq advanced 1.00% and the S&P-500 gained 0.64%.

Otherpoints on the news of the financial markets

• FOREX

The dollar index, which measures the fluctuations of the greenback against a basket of six other international currencies, is stabilizing near a two-year low. The euro gave up a little ground, around 1.1845 dollar.

The pound hit a five-month high against the dollar at 1.3182 after the Bank of England warned of the risks of resorting to negative interest rates.

• Oil

Crude futures are falling, despite the weakness of the dollar and the drop in inventories in the United States.

US light crude WTI took 0.57% to 42.27 dollars a barrel and Brent from the North Sea gained 0.18% to 45.09 dollars.

Today's economic calendar:

CHART OF THE DAY – EUR/CHF: A LONG-TERM SLIDE

On this chart in weekly data, the EUR/CHF is once again confronted with its long-term bearish slant. Indeed, the euro has benefited from the various recovery plans to support the economy, but remains penalized by an uncertain market environment and an escalation of USA-China tensions. As a result, investors are being cautious in taking refuge in defensive assets such as the Swiss franc.

At the moment, prices are locked between a support level at 1.0735 and resistance at 1.0840. Admittedly, the bearish slant prevents the pair from regaining height, however it is necessary to have a crossing of 1.0840 at the close to confirm the bullish recovery towards 1.0970 then 1.1000.

Conversely, the sellers could come out of the woodwork and take the psychological advantage on the current level. Thus, in the event of an incursion below 1.0735, the selling pressure could lead to a return of the market towards 1.0630.