Nordent and Avanza were among the biggest losers in the global stock market on Wednesday. Swedish online brokers suffered price drops of 10 and 9 percent, respectively, after presenting their September statistics.
Both had more clients than in the previous month, but the number of deals fell sharply. In Denmark and Norway, Nordnet customers conducted 20 and 14 percent fewer transactions, respectively, compared to August, while activity in Finland and Sweden was little changed. The number of people trading on the broker’s platform Avanza has shrunk by 9 percent.
Meanwhile, CNN’s “Fear & Greed” Index currently varies between “extreme fear” and “fear.” The alarming decline in the stock market in recent weeks and unusually large swings in the market not only dampened the mood, but also reduced the desire of people to trade securities and risk their savings. It doesn’t help that volatility has been so high in the currency and bond markets. Moreover, low purchasing power contributes to weakening the will and ability to invest.
In addition, a number of macroeconomic numbers scare investors. On Wednesday, it became known that the index of business activity in the eurozone fell from 48.9 in August to 48.1 in September. All measurements below 50 signals attenuated. The slowdown in the region’s factories was the strongest since June 2020, when the coronavirus reached its worst. The PMI report indicated that European companies are struggling with rising energy prices and lower demand.
Employment is a lagging indicator. In other words, it moves after GDP growth, mainly because businesses prefer to see a strong upward or downward trend before increasing or decreasing employment. However, economists noted that the latest report from the ADP on Wednesday showed employment growth of 208,000 in the US in September. In advance, an increase of about 200,000 was expected.
In the market, the interpretation of such numbers often depends on the mood among traders. If fear and pessimism prevail, surprisingly strong jobs numbers are a sign that the central bank will tighten more than expected. On the other hand, if there is a lot of hope and optimism, investors see the benefits of people who still have work and income.
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