IBEX 35 Braces for September Tests Amid US Employment and Inflation Uncertainty

The Spanish stock market, measured by the IBEX 35 index, has started September on a positive note, closing last week at 20,041.90 points after a 0.81% gain.

As the market enters this new month, it faces several key tests, including the impact of US employment and inflation data, as well as interest rate decisions from central banks in both the US and Europe.

The US employment report for August is expected to be particularly influential, with investors closely watching the numbers following a weaker-than-expected result in July. A strong labor market could reinforce calls for tighter monetary policy to combat inflation, while a weak reading might introduce doubts about the economy's ability to withstand higher interest rates.

The European Central Bank will also release new inflation data this week, which could influence its interest rate decisions. Higher-than-expected inflation would increase the likelihood of sustained elevated rates and potentially even further rate hikes.