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Market Talk – October 18, 2021

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China’s economic growth in the third quarter slumped to its slowest pace in a year, as a property slowdown and energy shortages highlighted rising pressure on policymakers. Gross domestic product grew 4.9 percent year on year between July and September, according to data released by the National Bureau of Statistics on Monday, compared with 7.9 percent in the three months ending in June. China’s economy far outperformed other developed countries in 2020, driven by a construction boom, higher industrial activity, and soaring exports, after new Covid-19 cases slowed to a trickle by the middle of the year. But the latest data reflect a loss of momentum, with industrial production growing 3.1 percent in September and edging just 0.1 percent higher month on month. Retail sales, a gauge of consumer spending that has lagged behind the wider recovery in part because of strict anti-coronavirus travel restrictions, beat expectations to grow 4.4 percent.

India’s merchandise trade deficit widened to a record $22.6 billion in September, the highest in at least about 14 years, as crude oil and gold imports surged, data released by the government showed on last Thursday. India’s merchandise exports rose $33.8 billion for the month from $27.56 billion in the same period last year, while purchases of crude oil and gold pushed imports to $56.39 billion in September from $30.52 billion last year. Oil imports rose nearly three times to $17.44 billion in September from $5.83 billion in the same month last year, while gold imports climbed to $5.1 billion from $601 million. India’s forex reserves crossed $637 billion at the end of September. The current account surplus stood at $6.5 billion in April-June quarter, data from the country’s central bank released showed.


The major Asian stock markets had a mixed day today:

  • NIKKEI 225 decreased 43.17 or -0.15% to 29,025.46
  • Shanghai decreased 4.23 or -0.12% to 3,568.14
  • Hang Seng increased 78.79 points or 0.31% to 25,409.75
  • ASX 200 increased 19.10 points or 0.26% to 7,381.10
  • Kospi decreased 8.38 points or -0.28% to 3,006.68
  • SENSEX increased 459.64 points or 0.75% to 61,765.59
  • Nifty50 increased 138.50 points or 0.76% to 18,477.05



The major Asian currency markets had a mixed day today:

  • AUDUSD decreased 0.00039 or -0.05% to 0.74128
  • NZDUSD increased 0.00043 or 0.06% to 0.70746
  • USDJPY decreased 0.01 or -0.01% to 114.25
  • USDCNY decreased 0.00942 or -0.15% to 6.42564


Precious Metals:

  • Gold increased 0.17 USD/t oz. or 0.01% to 1,767.43
  • Silver decreased 0.054 USD/t. oz or -0.23% to 23.230


Some economic news from last night:


Fixed Asset Investment (YoY) (Sep) decreased from 8.9% to 7.3%

GDP (YoY) (Q3) decreased from 7.9% to 4.9%

GDP (QoQ) (Q3) decreased from 1.2% to 0.2%

Chinese GDP YTD (YoY) (Q3) decreased from 12.7% to 9.8%

Industrial Production (YoY) (Sep) decreased from 5.3% to 3.1%

Chinese Industrial Production YTD (YoY) (Sep) decreased from 13.1% to 11.8%

Retail Sales (YoY) (Sep) increased from 2.5% to 4.4%

Chinese Retail Sales YTD (YoY) (Sep) decreased from 18.15% to 16.37%

Chinese Unemployment Rate decreased from 5.1% to 4.9%

New Zealand:

CPI (QoQ) (Q3) increased from 1.3% to 2.2%

CPI (YoY) (Q3) increased from 3.3% to 4.9%

RBNZ Offshore Holdings (Sep) increased from 47.70% to 48.60%


Non-Oil Exports (MoM) (Sep) increased from -3.50% to 1.20%

Non-Oil Exports (YoY) (Sep) increased from 2.70% to 12.30%

Trade Balance decreased from 6.253B to 4.999B



The yield, or interest rate, on the UK’s two-year government bonds jumped to its highest level since May 2019 as traders anticipated a rate rise. The two-year gilt yield jumped as high as 0.75%, up from 0.57% on Friday night, as a UK government bond selloff drove short-term borrowing costs to their highest in nearly two and a half years. Yields rise when bond prices fall. Rising yields suggest investors are pricing in higher interest rates, from their current record low, to curb inflation. Bank of England governor Andrew Bailey said he continued to believe the recent jump in inflation would be temporary, but he predicted that a surge in energy prices would push it higher and make its climb last longer, increasing the expectation of higher medium-term inflation.

The major Europe stock markets had a negative day:

  • CAC 40 decreased 54.42 points or -0.81% to 6,673.10
  • FTSE 100 decreased 30.20 points or -0.42% to 7,203.83
  • DAX 30 decreased 112.89 points or -0.72% to 15,474.47


The major Europe currency markets had a mixed day today:

  • EURUSD increased 0.00106 or 0.09% to 1.16096
  • GBPUSD decreased 0.00198 or -0.14% to 1.37243
  • USDCHF increased 0.00075 or 0.08% to 0.92322


No economic news from Europe today:


The Mortgage Bankers Association’s is predicting a decline in refinances into 2022. The association sees volume declining 33% in 2022 to $2.59 trillion. The average 30-year loan is predicted to rise to 4% after remaining artificially low throughout the pandemic. The result will be a 62% or $860 billion decrease in refinances, steepening the 14% decline projected for the current year. However, new loan originations are expected to rise 9% to a record high of $1.73 trillion in 2022.

“Zillow Offers has hit its capacity for buying home for the remainder of the year,” a representative reported to Bloomberg News. Known as a home listing site, the company launched Zillow Offers in 2018 and joined a group of online home-flippers often dubbed “iBuyers.” Zillow’s algorithm has allowed the company to find homes of potential resale value and offer buyers a direct offer on their homes. If accepted by the buyer, Zillow purchases the property, invests a bit of money in repairing the home, and then relists the property for sale at a higher price. The company said it needs to work through its large backlog of purchased homes.

Wholesale trade in Canada rose 0.3% in August to C$70.3 billion, according to Statistics Canada. This is the first increase after two consecutive months of decline. Food, beverage, and tobacco sales increased by 3.8% to $13.1 billion, marking the first time this sector has surpassed March 2020 numbers. StatsCan noted that this sector declined 10% at the beginning of the pandemic before quickly stabilizing around 5-6% beneath pre-pandemic levels. Building materials grew 2.3% or C$11.4 billion in August as well, largely due to an increase in electrical, plumbing, heating and air conditioning (6.8%). Lumber and other building supplies declined by 0.9%, marking the third consecutive month of decline. The auto sector fell 4.2% in August to C$10.3 billion, which analysts have blamed on a supply shortage (mainly chips). Machinery sales reached a 2021 low after falling 1.7% to C$14.4 billion.

US Market Closings:

  • Dow declined 36.15 points or -0.1% to 35,258.61
  • S&P 500 advanced 15.09 points or 0.34% to 4,486.46
  • Nasdaq advanced 124.47 points or 0.84% to 15,021.81
  • Russell 2000 advanced 2.19 points or 0.1% to 2,267.84


Canada Market Closings:

  • TSX Composite advanced 57.27 points or 0.27% to 20,985.37
  • TSX 60 advanced 4.88 points or 0.39% to 1,261.31


Brazil Market Closing:

  • Bovespa declined 219.81 points or -0.19% to 114,428.18





The oil markets had a negative day today:


  • Crude Oil decreased 0.23 USD/BBL or -0.28% to 82.0500
  • Brent decreased 0.44 USD/BBL or -0.52% to 84.4200
  • Natural gas decreased 0.283 USD/MMBtu or -5.23% to 5.1270
  • Gasoline decreased 0.0077 USD/GAL or -0.31% to 2.4787
  • Heating oil decreased 0.0245 USD/GAL or -0.95% to 2.5492


The above data was collected around 12:05 EST on Monday


  • Top commodity gainers: Bitumen (6.54%) and Tin (1.33%), Rhodium (1.43%) and Corn (0.62%)
  • Top commodity losers: Zinc (-3.02%), Palladium (-2.22%), Natural Gas (-5.23%), and Orange Juice (-2.83%)



The above data was collected around 12:15 EST on Monday





Japan 0.09%(+1.1bp), US 2’s 0.4193%(+0.02%), US 10’s 1.5949%(+2.11bps); US 30’s 2.0315%(-0.01%),Bunds -0.147% (+2.4bp), France 0.1960% (+2.9bp), Italy 0.9016% (+3.02bp), Turkey 19.16% (+10bp), Greece 0.9800% (+6.1bp), Portugal 0.409% (+5.7bp); Spain 0.508% (+3.92bp) and UK Gilts 1.138% (+3.3bp).