Market Talk – September 26, 2022

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ASIA:

The Philippines will stop operations of 175 offshore gambling firms and deport about 40,000 Chinese workers, a justice ministry official said on Monday, part of a crackdown on the notoriously opaque online gaming industry. The sector emerged in the Philippines in 2016 and grew exponentially as operators capitalized on the country’s liberal gaming laws to target customers in China, where gambling is banned. At their peak, Philippine offshore gambling operators, or POGOs, employed more than 300,000 Chinese workers, but the pandemic and higher taxes have forced many to operate elsewhere.

Indian shares closed at nearly two-month lows on Monday, mirroring the weakness in markets around the world, as investors dumped equities and other risky assets on worries over a slowdown in global economic growth. The NSE Nifty 50 index fell 1.8% to 17,016.30, while the S&P BSE Sensex dropped 1.6% to 57,145.22. The Indian rupee sank to a fresh record low on Monday at 81.6526 against the U.S. dollar. Meanwhile, the Reserve Bank of India is set to raise rates again this week, with a slim majority of economists in a Reuters poll expecting a half-a-percentage-point hike and some others expecting a smaller 35-basis-point rise.

 

 

The major Asian stock markets had a negative day today:

  • NIKKEI 225 decreased 722.28 points or -2.66% to 26,431.55
  • Shanghai decreased 37.14 points or -1.20% to 3,051.23
  • Hang Seng decreased 78.13 points or -0.44% to 17.855.14
  • Kospi decreased 69.06 points or -3.02% to 2,220.94
  • ASX 200 decreased 105.30 points or -1.60% to 6,469.40
  • SENSEX decreased 953.70 points or -1.64% to 57,145.22
  • Nifty50 decreased 311.05 points or -1.80% to 17,016.30

 

 

The major Asian currency markets had a mixed day today:

  • AUDUSD decreased 0.00750 or -1.15% to 0.64555
  • NZDUSD decreased 0.01060 or -1.85% to 0.56379
  • USDJPY increased 1.233 or 0.86% to 144.608
  • USDCNY increased 0.03690 or 0.52% to 7.16994

 

 

Precious Metals:

  • Gold decreased 16.43 USD/t oz. or -1.00% to 1,626.66
  • Silver decreased 0.395 USD/t. oz or -2.10% to 18.444

 

Some economic news from last night:

Japan:

Manufacturing PMI (Sep) decreased from 51.5 to 51.0

Services PMI decreased from 49.5 to 51.9

 

Some economic news from today:

Hong Kong:

Exports (MoM) (Aug) decreased from -8.9% to -14.3%

Imports (MoM) (Aug) decreased from -9.9% to -16.3%

Trade Balance increased from -27.6B to -13.3B

 

 

EUROPE/EMEA:

 

The pound fell to a record low against the dollar overnight, sparking market speculation that the Bank of England may be forced to intervene. The pound plunged below its all-time low against the greenback – set in February 1985 – of $1.054 early on Monday in Asian trading, fueling fears that parity was possible ahead. A statement from the bank was expected later Monday after sterling slipped by nearly 5% earlier in the day to $1.0327 – building on fresh 1985 lows seen on Friday after Chancellor Kwasi Kwarteng unveiled the biggest program of tax cuts for 50 years. The £45bn tax-slashing package saw the market deliver a verdict on the sustainability of the public finances, given the additional demands it will place on government borrowing. The government’s growth plan was clearly the catalyst for Friday’s plunge, but traders said it had since intensified the focus more widely as the dollar also shot up against a basket of other international currencies.

 

The major Europe stock markets had a mixed day:

  • CAC 40 decreased 14.02 points or -0.24% to 5,769.39
  • FTSE 100 increased 2.35 points or 0.03% to 7,020.95
  • DAX 30 decreased 56.27 points or -0.46% to 12,227.92

 

The major Europe currency markets had a mixed day today:

  • EURUSD decreased 0.00735 or -0.76% to 0.96118
  • GBPUSD decreased 0.01613 or -1.49% to 1.06877
  • USDCHF increased 0.01302 or 1.33% to 0.99492

 

Some economic news from Europe today:

Germany:

German Business Expectations (Sep) decreased from 80.5 to 75.2

German Current Assessment (Sep) decreased from 97.5 to 94.5

German Ifo Business Climate Index (Sep) decreased from 88.6 to 84.3

 

 

ENERGY:

 

The oil markets had a mixed day today:

 

  • Crude Oil decreased 1.834 USD/BBL or -2.33% to 76.906
  • Brent decreased 2.18 USD/BBL or -2.53% to 83.970
  • Natural gas increased 0.0875 USD/MMBtu or 1.28% to 6.9155
  • Gasoline increased 0.0085 USD/GAL or 0.36% to 2.3915
  • Heating oil decreased 0.1126 USD/GAL or -3.48% to 3.1245

 

The above data was collected around 15:01 EST on Monday

 

  • Top commodity gainers: Coffee (-1.52%), Canola (0.89%), Natural Gas (1.28%) and Sugar (0.38%)
  • Top commodity losers: Oat (-4.38%), Cotton (-6.52%), Lumber (-4.14%) and Palm Oil (-5.22%)

 

The above data was collected around 15:07 EST on Monday.

 

US/AMERICAS:

Wall Street continued to tumble this Monday as the S&P 500 reached an annual low after falling 1.03% to 3,655.04, surpassing June’s low of 3,666.77. The Dow continued to fall as well after shedding 1.11% or 329.6 points to close beneath the 30,000 level yet again. The Nasdaq also closed in the red, as all of Wall Street remains on edge since the Fed’s rate hike last week coupled with geopolitical turmoil.

The Cboe Volatility Index (VIX), sometimes called Wall Street’s fear gauge, rose by 3 points to 32.88 on Monday. The VIX, tracking the implied volatility of the S&P 500, has not closed above 30 since the start of the summer season. Inflation, rate hikes, and market sell offs have the market spooked.

US Market Closings:

  • Dow declined 329.6 points or 01.11% to 29,260.81
  • S&P 500 declined 38.19 points or -1.03% to 3,655.04
  • Nasdaq declined 65 points or -0.6% to 10,802.92
  • Russell 2000 declined 23.71 points or -1.41% to 1,655.88

 

Canada Market Closings:

  • TSX Composite declined 153.94 points or -0.83% to 18,327.04
  • TSX 60 declined 8 points or -0.71% to 1,114.61

 

Brazil Market Closing:

  • Bovespa declined 2,601.84 points or -2.33% to 109,114.16

 

BONDS:

 

Japan 0.251%(+1.6bp), US 2’s 4.32% (+0.105%), US 10’s 3.8817% (+18.47bps); US 30’s 3.70% (+0.088%), Bunds 2.092% (+6.1bp), France 2.697% (+9.4bp), Italy 4.526% (+16.6bp), Turkey 11.53% (+21p), Greece 4.680% (+14bp), Portugal 3.182% (+8.7bp); Spain 3.284% (+8.5bp) and UK Gilts 4.2510% (+42.2bp).