Market Talk – September 21, 2022

ASIA:

Taiwan will never allow China to “meddle” in its future, the government said on Wednesday, after a Chinese government spokesperson said Beijing was willing to make the utmost effort to strive for a peaceful “reunification” with the island. China claims democratically governed Taiwan as its own territory. Taiwan’s government rejects China’s sovereignty claims. China has been carrying out military drills near Taiwan since early last month, after U.S. House Speaker Nancy Pelosi visited Taipei, including firing missiles into waters near the island, though the activities have since scaled back. China has proposed a “one country, two systems” model for Taiwan, similar to the formula under which the former British colony of Hong Kong returned to Chinese rule in 1997.

The major Asian stock markets had a negative day today:

  • NIKKEI 225 decreased 375.29 points or -1.36% to 27,313.13
  • Shanghai decreased 5.23 points or -0.17% to 3,117.18
  • Hang Seng decreased 336.80 points or -1.79% to 18.444.62
  • Kospi decreased 20.64 points or -0.87% to 2,347.21
  • ASX 200 decreased 106.20 points or -1.56% to 6,700.20
  • SENSEX decreased 262.96 points or -0.44% to 59,456.78
  • Nifty50 decreased 97.90 points or -0.55% to 17,718.35

The major Asian currency markets had a mixed day today:

  • AUDUSD decreased 0.00410 or -0.61% to 0.66541
  • NZDUSD decreased 0.00130 or -0.22% to 0.58761
  • USDJPY increased 0.781 or 0.54% to 144.345
  • USDCNY increased 0.03160 or 0.45% to 7.06125
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Precious Metals:

  •  Gold increased 5.79 USD/t oz. or 0.35% to 1,668.90
  •  Silver increased 0.222 USD/t. oz or 1.15% to 19.532

Some economic news from last night:

Australia:

MI Leading Index (MoM) increased from -0.2% to -0.1%

New Zealand:

Credit Card Spending (YoY) increased from 5.1% to 29.4%

EUROPE/EMEA:

The British government said on Wednesday it will cap wholesale electricity and gas costs for businesses to less than half the market rate from next month, helping to ease pressure from rising energy prices but adding to rapidly rising government spending. Wholesale electricity prices will be capped at around £211 ($239) per megawatt hour (MWh) and gas prices at £75 per MWh, compared to forecast market rates of £600 and £180 respectively. Wholesale gas and electricity prices in Europe surged after Russia invaded Ukraine and have remained volatile since then. Final program unit prices will be confirmed on September 30. Groups representing businesses from pubs to steelmakers welcomed the crackdown, saying the government had thrown a lifeline to companies struggling to survive.

The major Europe stock markets had a green day:

  •  CAC 40 increased 51.86 points or 0.87% to 6,031.33
  •  FTSE 100 increased 44.98 points or 0.63% to 7,237.64
  •  DAX 30 increased 96.32 points or 0.76% to 12,767.15
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The major Europe currency markets had a mixed day today:

  • EURUSD decreased 0.00977 or -0.98% to 0.98742
  • GBPUSD decreased 0.00599 or -0.53% to 1.13203
  • USDCHF increased 0.00165 or 0.17% to 0.96575

Some economic news from Europe today:

UK:

Public Sector Net Borrowing (Aug) increased from 2.11B to 11.06B

Public Sector Net Cash Requirement (Aug) increased from -5.087B to 5.321B

CBI Industrial Trends Orders (Sep) increased from -7 to -2

US/AMERICAS:

The verdict is in and the Federal Open Market Committee voted to raise rates by three-quarters of a point. As inflation runs at a level not seen in 40 years, the Fed is acting aggressively with no plans to change its hawkish policy anytime soon. This marks the third consecutive 75 bps move with rates now sitting between 3% and 3.25%. The Fed has set a terminal rate of 4.6% in 2023, even if inflation is not at the 2% target. The Fed also said they see US GDP growing by only 0.2% in 2022, and rising by a mere 1.8% in the longer-term. “No one knows whether this process will lead to a recession or, if so, how significant that recession will be,” Jerome Powell said.

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US Market Closings:

  • Dow declined 522.45 points or -1.7% to 30,183.78
  • S&P 500 declined 66 points or -1.71% to 3,789.93
  • Nasdaq declined 204.86 points or -1.79% to 11,220.19
  • Russell 2000 declined 25.35 points or -1.42% to 1,762.16

Canada Market Closings:

  • TSX Composite declined 184.54 points or -0.95% to 19,184.54
  • TSX 60 declined 12.11 points or -1.03% to 1,160.53

Brazil Market Closing:

  • Bovespa declined 581.05 points or -0.52% to 111,935.86

ENERGY:

The oil markets had a mixed day today:

  • Crude Oil decreased 0.06 USD/BBL or -0.07% to 83.880
  • Brent decreased 0.101 USD/BBL or -0.11% to 90.519
  • Natural gas increased 0.0338 USD/MMBtu or 0.44% to 7.7508
  • Gasoline increased 0.0479 USD/GAL or 1.96% to 2.4957
  • Heating oil increased 0.0083 USD/GAL or 0.25% to 3.3805

The above data was collected around 13:47 EST on Wednesday

  • Top commodity gainers: Palm Oil (4.01%), Canola (2.15%), Bitumen (2.54%) and Cotton (3.06%)
  • Top commodity losers: Copper (-1.42%), Palladium (-2.11%), Coffee (-3.00%) and Lumber (-2.85%)

The above data was collected around 13:53 EST on Wednesday.

BONDS:

Japan 0.258%(+0.3bp), US 2’s 3.99% (+0.025%), US 10’s 3.5672% (-0.58bps); US 30’s 3.58% (-0.005%), Bunds 1.884% (-5.5bp), France 2.438% (-5.2bp), Italy 4.123% (-6.9bp), Turkey 11.32% (+0bp), Greece 4.454% (-2.7bp), Portugal 2.955% (-3.9bp); Spain 3.024% (-5.9bp) and UK Gilts 3.3140% (+2bp).

Original Article

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