The last week of August started off with volatility on Monday as German reports confirmed the country’s weakest business confidence index since 2010. The downturn continued into Tuesday, however, when Japanese reports indicated a weaker demand for Japanese exports. This monthly report, while no surprise to investors, has kept many investors waiting on the sidelines in the hope of more promising news. One such avenue for hope is the Federal Reserve summit that will take place in Wyoming this week, and global markets are unlikely to recover from their losses until Chairman Bernanke and ECB President Draghi announce whether they will be implementing plans to stimulate the major economies. A US consumer confidence report is also expected later today.
The MSCI Asia Pacific Index dropped 0.6 percent to 119.14 during Tuesday’s Asian session and the Nikkei 225 Stock Average posted similar losses. On Monday the dollar fell 0.3 percent against the yen, and the euro fell to $1.2473, its lowest level in a week. Tuesday’s European session which begins shortly is likely to see a slow open resulting from the losses compiling in the past few market sessions.