Markets rise, Fed expected to delay taper

Markets rose on Monday.

The STOXX Europe 600 rose 0.7 percent and the Nikkei 225 jumped 1.8 percent. The US stock market was closed for a holiday.

Investors appear unfazed by the lower-than-expected number of job gains in the US August employment report on Friday.

“In our view, the setback in the recovery in the labour market and the jump in serious covid infections will encourage the FOMC to wait before it announces it will taper its monthly asset purchases. We now expect the FOMC to announce an $US10bn taper of its monthly asset purchases at its 3 November meeting,” analysts at Commonwealth Bank of Australia wrote in a Monday note.

Indeed, Fundstrat Global Advisors’ co-founder and head of research Tom Lee told CNBC on Friday: “We could have a really strong rally in September.”

However, Lee also warned of a potential 10 percent correction in October.