European Markets Pause: between Trump-Putin summit and Fed expectations

European markets began the week with caution, showing moderate movements as they await geopolitical developments and economic decisions that could impact global markets. The main event over the weekend was the summit between U.S. President Donald Trump and Russian President Vladimir Putin. Despite high expectations, the meeting did not lead to any concrete solutions for the conflict in Ukraine, although it managed to avoid further escalation of the crisis.

Investors, however, seem unconvinced and are waiting for significant developments. All eyes are now on the meeting scheduled for this afternoon in Kyiv, featuring Trump, Ukrainian President Volodymyr Zelensky, and European leaders. This summit could be crucial in determining the next diplomatic moves regarding Ukraine and the future of Eastern Europe.

At the same time, the financial world is preparing for one of the most significant weeks of the year from an economic perspective: on Thursday, the Federal Reserve’s Jackson Hole symposium will begin, an event that attracts the attention of investors, economists, and central bankers from around the world. The Fed is in the spotlight, as markets are expecting important statements on U.S. monetary policy.

The focus is on Jerome Powell, the Fed Chairman, who will speak on Friday in a climate of growing uncertainty. Expectations are high: many analysts are betting on a potential interest rate cut in September, an idea that, according to the latest CME FedWatch data, has an 85% probability. Any such move could boost stock markets and encourage consumer spending but may also raise concerns about inflation and long-term economic stability.

Therefore, the week looks set to be full of events, with markets closely following not only developments related to U.S. monetary policy but also geopolitical shifts that could alter the global direction. The outcome of diplomatic negotiations and the Fed's decisions could have a decisive impact on the stock markets, affecting not just the U.S. economy, but also Europe and the rest of the world.

As answers await, investors remain cautious, ready to react to the signals that will emerge in the coming days.