Stock markets are consolidating ahead of the Jackson Hole meeting.
However, bulls remain in control and from a technical perspective, further gains in the DAX are likely with 13.500 points the next major obstacle.
On Wall Street, the party mood continues, largely thanks to the spectacular tech stock rally. They appear unstoppable, and even high valuations don’t seem to bother investors too much.
That the markets are so dependent on several large tech companies is not ideal. Unlike the dot-com bubble twenty years ago however, these are established giants that will reap the rewards from the digital transformation trends that are being accelerated by the coronavirus crisis.
The Jackson Hole annual symposium begins today, and the focus will be on the speech by US Fed Chair Jerome Powell. Market participants have high expectations.
It is expected that Powell will deliver insights about the Fed´s long-awaited monetary policy framework review.
The central bank might take a more relaxed approach to inflation, and allow it to occasionally exceed the 2 per cent target.
The most disappointing outcome for investors would be if Powell´s speech ends up being short on detail, leaving more questions open than it answers.