Market Talk – September 28, 2022

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ASIA:

Japanese Finance Minister Shunichi Suzuki said authorities stood ready to respond to speculative currency moves, a fresh warning that comes days after Tokyo intervened in the foreign exchange market to stem yen falls for the first time in more than two decades. Suzuki also told a news conference on Monday the government and the Bank of Japan (BOJ) were on the same page in sharing concerns about the currency’s sharp declines. Japan likely spent a record around 3.6 trillion yen ($25 billion) last Thursday in its first dollar-selling, yen-buying intervention in 24 years to stem the currency’s sharp weakening, according to estimates by Tokyo money market brokerage firms. BOJ Governor Haruhiko Kuroda said on Monday the central bank was likely to retain its ultra-loose monetary policy for the time being but added that its commitment to keep interest rates at “present or lower levels” may not necessary stay unchanged for years.

The major Asian stock markets had a negative day today:

  • NIKKEI 225 decreased 397.89 points or -1.50% to 26,173.98
  • Shanghai decreased 48.79 points or -1.58% to 3,045.07
  • Hang Seng decreased 609.43 points or -3.41% to 17.250.88
  • Kospi decreased 54.57 points or -2.45% to 2,169.29
  • ASX 200 decreased 34.20 points or -0.53% to 6,462.00
  • SENSEX decreased 509.24 points or -0.89% to 56,598.28
  • Nifty50 decreased 148.80 points or -0.87% to 16,858.60

 

 

The major Asian currency markets had a mixed day today:

  • AUDUSD increased 0.00841 or 1.31% to 0.65157
  • NZDUSD increased 0.00727 or 1.29% to 0.57077
  • USDJPY decreased 0.625 or -0.43% to 144.160
  • USDCNY increased 0.0167 or 0.23% to 7.19490

 

 

Precious Metals:

  • Gold increased 30.49 USD/t oz. or 1.87% to 1,659.29
  • Silver increased 0.359 USD/t. oz or 1.95% to 18.789

 

Some economic news from last night:

Australia:

Retail Sales (MoM) (Aug) decreased from 1.3% to 0.6%

 

Some economic news from today:

Japan:

Coincident Indicator (MoM) decreased from 1.4% to 0.9%

Leading Index (MoM) decreased from -0.3% to -1.4%

Leading Index decreased from 100.3 to 98.9

 

 

EUROPE/EMEA:

The European Central Bank may need to raise interest rates by another 75 basis points at its October meeting and move again in December to a level that no longer stimulates the economy, policymakers said on Wednesday. The ECB lifted interest rates by a combined 125 basis points at its past two meetings, the fastest pace of policy tightening on record, but inflation may still be months from its peak, pointing to even more tightening from a bank that started hiking well after most of its top peers. Markets see the ECB’s 0.75% deposit rate rising to 2% by the end of the year, then to around 3% next spring. Inflation is forecast to stay above the ECB’s 2% target through 2024 and even longer-term expectations are above target. ECB President Christine Lagarde said the “first destination” in the rate hiking cycle will be the “neutral” rate, which neither stimulates not slows growth.

The major Europe stock markets had a green day:

 

  • CAC 40 increased 11.19 points or 0.19% to 5,765.01
  • FTSE 100 increased 20.80 points or 0.30% to 7,005.39
  • DAX 30 increased 43.60 points or 0.36% to 12,183.28

 

The major Europe currency markets had a mixed day today:

  • EURUSD increased 0.01034 or 1.08% to 0.96953
  • GBPUSD increased 0.01167 or 1.09% to 1.08377
  • USDCHF decreased 0.01463 or -1.48% to 0.97667

 

Some economic news from Europe today:

Germany:

GfK German Consumer Climate (Oct) decreased from -36.8 to -42.5

France:

French Consumer Confidence (Sep) decreased from 82 to 79

Italy:

Italian Business Confidence (Sep) decreased from 104.0 to 101.3

Italian Consumer Confidence (Sep) decreased from 98.3 to 94.8

Italian Industrial Sales (YoY) (Jul) decreased from 17.90% to 16.30%

Italian Industrial Sales (MoM) (Jul) increased from -0.40% to -0.10%

US/AMERICAS:

Eligible Americans refinanced their mortgages when rates were at an all time low. With rates surpassing the 7% level, averaging 6.52%, for a 30-year-fixed mortgage, refinances are less commonplace. Refinances fell 11% on a weekly basis and 84% YoY, marking a 22-year low. New mortgage applications fell 0.4% for the week and were 29% lower YoY.

The Biden Administration announced another $1.1 billion dollar loan to Ukraine. The US has now provided Ukraine with $16.2 billion since Russia invaded in February. The US also announced it would not recognize the referendum election held in Ukraine in which the majority voted to join Russia.

US Market Closings:

  • Dow advanced 548.75 points or 1.88% to 29,683.74
  • S&P 500 advanced 71.74 points or 1.97% to 3,719.03
  • Nasdaq advanced 222.13 points or 2.05% to 11,051.64
  • Russell 2000 advanced 52.73 points or 3.17% to 1,715.24

 

Canada Market Closings:

  • TSX Composite advanced 341.01 points or 1.86% to 18,648.92
  • TSX 60 advanced 18.61 points or 1.67% to 1,130.66

 

Brazil Market Closing:

  • Bovespa advanced 74.85 points or 0.07% to 108,451.2

 

 

ENERGY:

 

The oil markets had a green day today:

 

  • Crude Oil increased 3.47 USD/BBL or 4.42% to 81.970
  • Brent increased 3.008 USD/BBL or 3.49% to 89.278
  • Natural gas increased 0.0959 USD/MMBtu or 1.44% to 6.7469
  • Gasoline increased 0.0471 USD/GAL or 1.89% to 2.5402
  • Heating oil increased 0.1825 USD/GAL or 5.60% to 3.4424

 

The above data was collected around 12:25 EST on Wednesday

 

  • Top commodity gainers: Heating Oil (5.60%), Crude Oil (4.42%), Brent (3.49%) and Orange Juice (3.73%)
  • Top commodity losers: Palm Oil (-8.43%), Rubber (-1.49%), HRC Steel (-2.74%) and Cotton (-1.77%)

 

The above data was collected around 12:32 EST on Wednesday.

 

BONDS:

 

Japan 0.255%(+0.5bp), US 2’s 4.15% (-0.155%), US 10’s 3.7793% (-18.37bps); US 30’s 3.70% (-0.129%), Bunds 2.119% (-13.3bp), France 2.734% (-9.7bp), Italy 4.585% (-14.5bp), Turkey 11.62% (+12p), Greece 4.855% (+0.1bp), Portugal 3.222% (-13.5bp); Spain 3.332% (-9.6bp) and UK Gilts 4.0290% (-47.5bp).